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[cdn-nucl-l] US nuclear plants sold for record high price
Tuesday March 28 2000 10:36 PM ET
NY State Sells 2 Nuclear Plants
By LARRY McSHANE, Associated Press Writer
NEW YORK (AP) - A New Orleans-based company agreed to pay $967 million
Tuesday for a pair of state-owned nuclear power plants - a new record for a
nuclear facility and the largest privatization of state assets in New York
A last-minute revised offer by Entergy Nuclear, Inc. was accepted over a
rival bid from Dominion Resources Inc. of Richmond, Va.
Dominion, insisting its bid was actually higher than Entergy's by $35
million, said it would consider legal action against the New York Power
Authority over its sale of the Indian Point 3 nuclear unit in Buchanan and
the James A. Fitzpatrick nuclear site in Oswego.
Both Dominion and Entergy submitted updated bids on Tuesday morning, one
week after NYPA officials debated for 11 hours without reaching a decision
between the two suitors.
``This is one of the most complex things I've ever seen,'' said Power
Authority chairman/CEO C.D. Rappleyea. ``Both of these offers were very
significant. But to me an offer doesn't mean anything unless you can close
The purchase price includes nuclear fuel and 1,700 staffers. As part of the
agreement, Entergy agreed to accept full responsibility for possible tax
liability over the plants' decommissioning fund - a potential $250 million
Dominion called the possible tax bill a deal breaker, although the company's
head complained that state officials were too impatient in making a deal.
``It's a shame that NYPA was unwilling to wait for our company to resolve
the tax issue, and selected a competing bid that offered less cash,'' said
Thos. E. Capps, president and CEO of Dominion.
Although advisers to the authority put Dominion's bid at $21 million less
than Entergy's, the company insisted that was the result of convoluted math
and called their bid $35 million better.
Asked about possible legal action, Dominion spokesman Mark Lazenby said,
``We're looking at all options.''
Either way, the cost of $536 per kilowatt was almost four times as high as
the previous best sale of a nuclear plant, establishing a new benchmark,
Dominion made an unsolicited bid for the two plants in February, three
months after state officials began negotiating exclusively with Entergy. The
bidding was reopened, with the two companies battling for control of the
``We thank you for the trust you've shown in us,'' said Jerry Yelverton,
chairman and CEO of Entergy Nuclear. ``We'll come in and bring all the
expertise we have, and maintain your expertise.''
Entergy now owns seven nuclear plants, making it the second-largest owner of
nuclear stations in the United States. The sale still requires the approval
of the Nuclear Regulatory Commission.