Posted on 10/10/2007 6:06:44 PM PDT by txzman
C. John Wilder resigned as chairman and chief executive of TXU with the merger. He planned to leave with at least $277 million worth of stock, according to a TXU regulatory filing in July.
DALLAS - TXU Corp., the biggest power generator in Texas, officially passed from public to private ownership Wednesday and got a new name as investors closed the $32 billion buyout.
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The new owners are investors led by private-equity firms Kohlberg Kravis Roberts & Co. and TPG, formerly Texas Pacific Group.
TXU changed its name to Energy Future Holdings Corp.
Donald L. Evans, former U.S. commerce secretary, has been named non-executive chairman for Energy Future Holdings and will lead the company's board of directors.
Critics say the sale will lead to higher prices for consumers to pay off $24.5 billion in new debt that the buyers put on TXU.
Company officials responded Wednesday that they would cut electric rates by 5 percent on top of a 10 percent reduction last spring. The company also said its Luminant unit would withdraw eight air permit applications that had been filed for coal-fueled generation units that will not be built.
TXU officials said their 2.1 million electricity customers wouldn't notice any change. Bills will still come from TXU Energy, and repair trucks will still carry the logo of Oncor Electric Delivery, TXU's electric-transmission unit.
TXU shareholders will get $69.25 per share. The TXU common stock stopped trading at the close of business Wednesday.
The outlook for bondholders is less clear.
On Tuesday, credit-rating agencies Moody's Investors Service and Standard & Poor's downgraded TXU because of concerns about new debt from the takeover.
Moody's rated TXU's electric-transmission unit, Oncor Electric Delivery, one notch below investment-grade, or the highest "junk bond" rating. It rated TXU's corporate debt four notches below that.
S&P cut its rating on TXU corporate debt and its power-generation and retail sales units four notches — S&P already had those ratings two notches below investment-grade.
The TXU sale was the largest private buyout ever when announced in February, but bigger sales eclipsed it later before the takeover tidal wave crested.
Federal nuclear and energy regulators approved the deal, and TXU shareholders overwhelmingly approved it in September. The investors had to firm up financial arrangements before announcing the deal had closed.
TXU has three divisions: Luminant, which operates power plants; Oncor, which distributes the power over transmission lines; and TXU Energy, which sells it to residential and business customers.
The investors promised state lawmakers they won't sell the company for at least five years.
I'm a capitalist as much as anyone - but I will vote to curb the unethical, greedy destruction of American taxpayers and captive users of basic needs.
Before: Power to the people!
Now: Wait no... less power to the people but more money for us!
You are free to start your own private equity fund and buy a utility. They will charge what the market can bare. Doesn’t sound like you are a capitalist until you perceive it won’t benefit you directly.
He’s getting $277 million in stock, not cash.
Which, since you changed the title, added your own interjections, and didn’t bother to read it, is about to be all but worthless if you look at the ratings, is probably going to be redeemable for one candy bar.
Coal fired candybar
I don’t quite understand - where does the purchase price go?
“I’m a capitalist as much as anyone - but I will vote to curb the unethical, greedy destruction of American taxpayers and captive users of basic needs.”
I hate to be the one to break it to you, but you’re not a capitalist, let alone “as capitalist as much as anyone.”
Actually, you sound a lot like Hillary.
TXU in after hours trading is at $69.24/sh.
One hell of alot of candy bars
Current stockholders.
OK, I get it. “Public ownership” in this case means the members of the public that owned the stock. I thought that “public” meant that the government or other entity held some ownership.
Yes, TXU was an investor owned utility. They’ve had a lot of layoffs trying to make the bottom line look good for this sale, but quality and reliability have really slipped in the last few months. Customer service is also bad, although not as bad as Verizon.
Invest in TX energy to customers. We are getting SCREWED for the last 3 years. It’s typical to pay up to $500 a month for a house and about 200 for an apartment to keep it at 72F during prime time.
It’s.. A disaster! It used to be $50-80 about 5 years ago.
TX electric rates are a damn uncompetive crime.
I mean, people should be jailed for these prices.
TXU runs the racket, and even with degulation, if you choose another company, you get all the TXU rates included.
Millions of Texans are paying hundreds, perhaps thousands, per year into these clowns’ pockets.
To millions of people like me. I own 30 shares so they'll be sending me a check for about $2,000.
Frankly, I can use it right now.
“It’s typical to pay up to $500 a month for a house and about 200 for an apartment to keep it at 72F during prime time.
It’s.. A disaster! It used to be $50-80 about 5 years ago.”
Did they start regulating in the last few years? Is regulation what drove prices higher?
They started DE regulating..
the lie of global warming and Jane Fonda and the anti-nuke freaks drove everybody to nat gas in 1990s. Demand UP means price UP. Blame the greenies and the other freaks for your high prices.
Build nukes and have stable prices for 50 years.
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