Shares

Shares of Upper Midwest gas and electric utility company NorthWestern Corp. fell 7% by Wednesday afternoon to $2.57/share after the company announced that it is suspending its common stock dividend and expects about $700 million in special charges for 2002 because of the poor performance of its investments in CornerStone Propane, communications network provider Expanets, and heating and airconditioning unit Blue Dot.

Shares of Upper Midwest gas and electric utility company NorthWestern Corp. fell 7% by Wednesday afternoon to $2.57/share after the company announced that it is suspending its common stock dividend and expects about $700 million in special charges for 2002 because of the poor performance of its investments in CornerStone Propane, communications network provider Expanets, and heating and airconditioning unit Blue Dot.

Standard & Poor’s Ratings Services lowered El Paso Corp.’s credit ratings to ‘B+’ from ‘BB’ on Friday, ending a long and difficult week, that included a 42% collapse in El Paso’s stock price to $4.92/share on Friday from Monday’s open. Investors dumped the company’s stock after it announced that it would cut its dividend 82% to 16 cents annually, sell off another $2.9 billion in assets and exit the rapidly growing liquefied natural gas (LNG) business.

El Paso Corp. shares plummeted 22.5% to $6.20 Wednesday in response to a dramatic shift in strategy and drastic financial measures taken by the company because of its seriously weakened financial position. The company said it will cut its common stock dividend by 82%, a larger amount than was expected by some analysts, to provide about $425 million in annual cash flow. It also will sell another $2.9 billion in assets to help provide funds for continuing operations. The company currently has liquidity of $2.6 billion but only about $600 million is cash.

Shares of Westar Energy tumbled more than 7% last Monday after the Kansas-based power company disclosed that it will be required to transfer certain of its utility operations to a utility-only subsidiary by the start of August 2003 under an order recently issued by the Kansas Corporation Commission (KCC). The decision also requires that the consolidated debt of all of the company’s utility businesses not exceed $1.67 billion.

Unocal Corp. on Thursday revised downward its fourth quarter earnings forecast, citing lower crude oil and natural gas prices, increased environmental remediation costs, and expenses resulting from its acquisition of Pure Resources Inc.

Mirant shares fell from the high $3.70s early last week to the mid $3.20s Friday after CEO Marce Fuller warned on Tuesday that the company was about 20 cents/share behind where it expected to be at this time in the year. Fuller expressed concerns about Mirant’s ability to meet its earnings forecast of $1.60/share for the year. The current average of Wall Street analysts’ estimates is $1.54 with a low of $1.45 and a high of $1.69, according to Thomson Financial.

Shares of El Paso, Dynegy and Williams are trading at discounts to “liquidation values,” making them attractive takeover targets, according to a report released last Monday by Credit Suisse First Boston. The investment house predicts a recovery of 40-50% from the group in the next three to six months.

Williams’ share price tumbled 10% to $14.66/share by mid-day Monday following an announcement by its former communications subsidiary, Williams Communications (WCG), that it will include voluntary Chapter 11 bankruptcy reorganization as a potential option as part of its financial restructuring plan. Williams already is examining the possibility that it will be obligated to cover WCG’s $2.2 billion in debt if the communications company defaults on its loans.