In its quest to become the first nationally branded utility inthe United States, TNPC Inc. — an alliance of Enron Corp.,America Online and IBM — said yesterday that its initial publicoffering of 24 million common shares at $21 per share would net thecompany nearly $473 million to intensify its retail marketingefforts and build a customer base.
The Greenwich, CT-based company in the next few months hopes tolaunch services in markets where natural gas and electricity arederegulated. Through its retail marketing unit subsidiary, The NewPower Company, TNPC will offer direct energy services to residencesand small businesses, along with other customer incentives such asfrequent flier miles.
Publicly launched in May by its strategic partners, it filed inJuly with the Securities and Exchange Commission to launch its IPO(see Daily GPI, July 17). TNPC initiallyhad received a capital infusion from its sponsors of more than $120million, and increased its market stake with a purchase in July ofColumbia Energy Group’s retail gas and power, mass marketingbusiness. That business now serves 300,000 retail customers in eightstates (see Daily GPI, July 5).
The New Power Company began an intense marketing effort in lateAugust to grab customers in deregulated markets in Pennsylvania andNew Jersey. The pitch guarantees customer savings of up to 15% forswitching from Newark, NJ-based Public Service Electric & GasCo. And for new customers who switch from PECO Energy Co., based inPhiladelphia, the marketer is guaranteeing a savings of up to 25%.There were no figures on the amount of customers who so far havemade the switch.
In a private placement transaction in January, Enron contributedits residential and small commercial business to the new venture,and with AOL and IBM, also signed multi-year marketing and serviceagreements.
Enron owns a 52% stake in TNPC through value-in-kindinvestments, such as providing energy commodity pricing, riskmanagement and government regulatory affairs. IBM is building thecorporate infrastructure and web site and will man the call center.AOL will give TNPC access to its 22 million customers for sixyears.
TNCP’s shares will be listed under the symbol “NPW,” and closingof the offering is expected next Wednesday (Oct. 11). Credit SuisseFirst Boston and Donaldson, Lufkin & Jenrette are co-leadmanaging underwriters. Chase H&Q, CIBC World Markets,PaineWebber Inc., Salomon Smith Barney and DLJdirect Inc. areco-managers.
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