National Grid Group PLC
21 December 2001
National Grid and Niagara Mohawk - update on Preferred Stock
National Grid Group plc announced today that it will, within a year of closing
the acquisition of Niagara Mohawk Holdings, Inc. (Niagara Mohawk), have
Niagara Mohawk Power Corporation (Niagara Power) or an affiliate make offers
to purchase all of the then outstanding preferred stock of Niagara Power. Such
offers will be made at prices that are customary for a tender offer to
purchase similar preferred stock and will be determined at the time the offers
are made. Such determination of prices will be made by National Grid based on
advice of an investment banking firm. National Grid's commitment will not
affect the ability of Niagara Power to voluntarily redeem or otherwise call
its preferred stock. National Grid's commitment is subject to completion of
the Niagara Mohawk acquisition. The offers will also be subject to receiving
all required regulatory approvals required for preferred stock offerings.
Niagara Power currently has outstanding preferred stock with a par value of
approximately $440 million with dividend rates ranging from 3.4% to 7.85%.
This offer commitment to make offers resolves issues raised by certain Niagara
Power preferred stockholders in an intervention filed at the Securities and
Exchange Commission in connection with the acquisition of Niagara Mohawk, and
this intervention has been withdrawn. The acquisition of Niagara Mohawk is
expected to be completed in early 2002.
National Grid Group plc has not commenced the tender offer that is referred to
in this communication and, because commencement of such tender offer is
subject to certain conditions, including completion of the acquisition of
Niagara Mohawk Holdings, Inc. by National Grid Group plc and receipt of
regulatory approvals, no assurance can be given as to whether such tender
offer will be commenced or the timing of commencement. If the tender offer is
commenced, National Grid Group plc will file with the Securities and Exchange
Commission a Schedule TO and related exhibits. Holders of Niagara Mohawk Power
Corporation preferred stock are strongly encouraged to read the Schedule TO
and related exhibits if and when they become available because they will
contain important information about the offer. In such event, the Schedule TO
and related exhibits will be available without charge at the Securities and
Exchange Commission website at www.sec.gov and will be delivered without
charge to all Niagara Mohawk Power Corporation preferred stockholders of
record at the commencement of the tender offer. Following commencement of the
tender offer, Niagara Mohawk Power Corporation preferred stockholders of
record at the commencement of the tender offer will also be able to obtain,
without charge, copies of these documents from National Grid Group plc.
Safe-Harbor Statement
This statement contains certain statements that are neither reported financial
results nor other historic information. These statements are forward looking
statements within the meaning of the safe-harbor provisions of the U.S.
federal securities laws. Because these forward-looking statements are subject
to risks and uncertainties, actual future results may differ materially from
those expressed in or implied by the statements. Many of these risks and
uncertainties relate to factors that are beyond the companies' ability to
control or estimate precisely, such as the completion of the merger with
Niagara Mohawk Holdings, Inc., the satisfaction of other conditions relating
to a commencement of a tender offer, future market conditions and responses by
competitors to deregulation, new regulatory or legislative requirements, the
future actions or decisions of federal or state governmental regulators, the
timing and extent of changes in supply and demand of, and prices of, gas and
electricity and other risk factors detailed in National Grid's reports filed
with the SEC. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this document.
ENQUIRIES:
National Grid:
Investors
Marcy Reed +44 (0)20 7312 5779 +44 (0)7768 490807(m)
Terry McCormick +44 (0)20 7312 5785 +44 (0)7768 045139(m)
Media
Susan Stevens +44 (0)20 7312 5740 +44 (0)7769 671560(m)
Clive Hawkins +44 (0)20 7312 5757 +44 (0)7836 357173(m)
Citigate Dewe Rogerson: +44 (0)20 7638 9571
Anthony Carlisle +44 (0)7973 611888(m)
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