Williams announces sale of power agreement
Friday, March 21st 2003, 12:00 am
By: News On 6
TULSA, Okla. (AP) -- Williams Cos. announced Friday it will sell an electric contract with one of the nation's largest power cooperatives to Progress Energy for $188 million in cash.
The Tulsa-based energy giant agreed to sell a full-requirements power agreement with Jackson Electric Membership Corp. in Jefferson, Ga. The cooperative serves more than 171,000 customers in 10 metro Atlanta and northeast Georgia counties.
The sale, expected to close by May 30, will free up cash for Williams, which announced last month plans to sell $2.5 billion in assets to meet debt obligations.
"We further reduced the role of our energy marketing and risk management business, which is consistent with our plans to substantially exit that business," said Steve Malcolm, Williams chairman, president and chief executive officer.
The sale will be reflected in Williams' second-quarter results.
Williams shares rose 26 cents or 3.6 percent by Friday afternoon to $4.31.
The 15-year contract to manage Jackson's 1,100-megawatts began Oct. 1, 2001. Raleigh, N.C.-based Progress is expected to assume responsibility for the agreement effective May 31.
Williams will continue to manage 1,050 watts of power for four other Georgia power cooperatives.
Under the terms of the agreement, Williams will receive $175 million at closing and an additional $13 million as requirements related to the transitioning of operations are met by August 15.