Dominion Resources
and Consolidated Natural Gas File Amended Proxy
Special Shareholder
Meetings Set for June 30th
RICHMOND, Va. and PITTSBURGH -- Dominion Resources Inc. [NYSE:
D] and Consolidated Natural Gas Company [NYSE: CNG] today announced that an
amended joint proxy statement reflecting the revised terms of the merger agreement
was filed Thursday with the Securities and Exchange Commission and became effective
today.
Dominion Resources amended the terms of the original merger
agreement on May 11, offering a mixture of stock and cash to provide shareholders
of Consolidated Natural Gas $66.60 in value. The original transaction that had
been agreed to in February offered only stock.
In addition, special meetings for both companies’ shareholders
to approve the merger have been set for Wednesday, June 30, at 9:30 a.m. The
Dominion Resources meeting will be held in Richmond at the offices of McGuire,
Woods, Battle & Boothe LLP. The Consolidated Natural Gas meeting will be held
in Tarrytown, N.Y. at Tappan Hill. Shareholders of record as of April 29 and
May 13 will be allowed to vote their shares for the merger at the Dominion Resources
and Consolidated Natural Gas meetings respectively.
The joint proxy also notes that the post-merger business
plan projects that earnings per share for Dominion Resources will increase at
an average annual compound growth rate of 9 percent. According to the business
plan, Dominion Resources’ earnings per share is expected to increase from an
estimated $3.31 in 2000 to $4.66 in 2004 for the combined entity. The post-merger
business plan was prepared to reflect the best currently available estimates
and judgments. Actual results will be influenced by a variety of factors, some
of which cannot be reasonably foreseen or are beyond the companies’ control.
The current annual dividend for Dominion Resources is $2.58
per share. Dominion Resources’ targeted payout ratio of dividends to earnings
is 70 percent to 75 percent. The current payout ratio is higher, but Dominion
Resources’ business plan projects that the targeted ratio will be achieved within
two years after the merger is completed through earnings growth. Therefore,
Dominion Resources’ dividend will be maintained at its current level, the proxy
stated.
Thos. E. Capps, chairman, president and chief executive officer
of Dominion Resources, said:
"The merger between our companies continues on schedule.
Filing the amended proxy and setting the date for the shareholder meetings is
another milestone in the process of uniting two of the most respected companies
in electricity and natural gas. This union will provide the needed critical
mass for today’s rapidly changing energy sector."
George A. Davidson Jr., chairman and chief executive officer
of Consolidated Natural Gas, said:
"As the $300 billion natural gas and electric industries
converge, the combined company will be able to offer a complete line of energy
products including energy, gas and/or electricity to both retail and wholesale
customers through the combined company’s generation and pipeline assets."
Initial filings for the combination are largely completed.
On April 5, filings were made with the Securities and Exchange Commission and
in North Carolina, Pennsylvania, Virginia and West Virginia. The Hart-Scott-Rodino
filing was made on May 10. The companies anticipate filing with the Federal
Energy Regulatory Commission shortly.
This release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934. The forward-looking
statements are subject to various risks and uncertainties. Discussion of factors
that could cause actual results to differ materially from management’s projections,
forecasts, estimates and expectations may include factors that are beyond the
company’s ability to control or estimate precisely, such as estimates of future
market conditions and the behavior of other market participants. Other factors
include, but are not limited to, weather conditions, economic conditions in
the company’s service territory, fluctuations in energy-related commodity prices,
conversion activity, other marketing efforts and other uncertainties. Other
risk factors are detailed from time to time in the company’s SEC reports.
