Fitch Rates Xcel Senior Notes 'A-'.Business Editors NEW YORK--(BUSINESS WIRE)--Dec. 14, 2000 Fitch expects to assign an 'A-' rating to Xcel Energy Inc.'s (Xcel) planned $600 million issue of senior notes due 2010. The company's Rating Outlook is Stable. This issue will be Xcel's first long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. security issued by the holding company since the August 2000 merger of Northern States Power Company Northern States Power Company (formerly NYSE: NSP) was a publicly-traded S&P 500 electric and natural gas utility holding company based in Minneapolis, Minnesota that is now a subsidiary of Xcel Energy (NYSE: XEL). and New Century Energies, Inc. The notes will be issued under a new indenture. Fitch also rates Xcel Energy Inc.'s commercial paper `F2'. Roughly 60% of the net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from sale of the securities will be used to make additional equity investments in Xcel's wholly owned subsidiaries Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. Northern States Power Co., Minnesota and Public Service Company of Colorado and to reduce intercompany debt owed to a subsidiary, Southwestern Public Service Company. The balance will be used to retire a portion of Xcel's outstanding short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. . The senior notes are unsecured and will rank at parity with other unsecured indebtedness of Xcel. The indenture does not limit the amount of indebtedness or liens that can be issued, and it does not include a provision for unsecured creditors Unsecured Creditor An individual or institution that lends money without obtaining specified assets as collateral. This poses a higher risk to the creditor because they have nothing to fall back on should the borrower default on the loan. A debenture holder is an unsecured creditor. to become secured in the event that other secured debt is issued. It should be noted that there is no secured debt of Xcel at this time. Xcel is a holding company, and cash flow to service debt at the parent company is derived primarily from upstream dividends and other distributions from its subsidiaries. Senior debt of Xcel is thus structurally subordinated to senior debt of the subsidiaries. The principal contributors of upstream dividends are utility operating companies, including Northern States Power Co., Minnesota; Northern States Power Co., Wisconsin; Public Service Company of Colorado and Southwestern Public Service Company. Another major subsidiary is NRG NRG Energy NRG NRG Energy, Inc. NRG Natural Resources Group NRG New Radiancy Group NRG Network Referral Group NRG Network Resource Grapher NRG Numerics Rapporteur Group NRG Neuroprosthetics Research Group NRG notional requirements generator , a large power developer and owner of electric generation facilities, but not a source of dividends to Xcel. NRG is currently 82% owned by Xcel. For additional information on Xcel Energy, Northern States Power Co., Minnesota; Northern States Power Co., Wisconsin; Public Service Company of Colorado and Southwestern Public Service Company, please see ratings and credit comments on Fitch's web site at `www.fitchratings.com'. |
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