GPU Inc. Subsidiaries' Ratings Affirmed by S&P.NEW YORK--(BUSINESS WIRE)--S&P CreditWire 10/14/97--Standard & Poor's today affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. its ratings on GPU GPU: see secret police. (Graphics Processing Unit) A specialized logic chip devoted to rendering 2D or 3D images. Display adapters contain one or more GPUs for fast graphics rendering. Inc. subsidiaries Jersey Central Power and Light Co., Metropolitan Edison Edison, township (1990 pop. 88,680), Middlesex co., NE N.J., inc. 1870 as Raritan Township, renamed 1954. Edison's varied manufactures include light trucks, chemicals, metal products, electrical and electronic equipment, machinery, and instruments. Co., and Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York Electric Co. following the announcement by GPU that it will purchase PowerNet, the high-voltage transmission company for the Australian state Noun 1. Australian state - one of the several states constituting Australia province, state - the territory occupied by one of the constituent administrative districts of a nation; "his state is in the deep south" of Victoria, for U.S. $1.88 billion. The outlook on Jersey Central Power and Pennsylvania Electric remains stable; the outlook on Metropolitan Edison remains positive. GPU will finance this acquisition initially with $1.405 billion of non-recourse bank debt, a $425 million bridge equity loan, and $50 million of cash equity. While this incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. debt load is significant, management has indicated its intent to pay it down rapidly, principally with the proceeds from six to seven million new shares of common stock (about $37 current share price), perhaps issued as soon as early 1998, and from divesting its fossil and hydro hy·dro adj. Hydroelectric. n. pl. hy·dros 1. Hydroelectric power. 2. A hydroelectric power plant. generating facilities. Under current regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. , GPU must also sell down to no more than 20% its 50% ownership interest in Solaris Power, a distribution company in Victoria. Any 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 this sale would also be applied against outstanding debt. The purchase of PowerNet is consistent with GPU's stated strategy of exiting the higher-risk generation business and focusing on the more stable transmission and distribution businesses, both domestically and in mature international markets. Standard & Poor's believes that the success of this strategy will improve the overall business risk profile of GPU. PowerNet itself generates a very stable revenue stream, which varies only marginally with usage. This company is expected to be self-financing with respect to the acquisition-related debt that will reside on its balance sheet. OUTLOOK (Jersey Central Power, Pennsylvania Elec): STABLE OUTLOOK (Metropolitan Edison): POSITIVE The stable outlook for Jersey Central Power and Light Co. and Pennsylvania Electric Co. and the positive outlook for Metropolitan Edison Co. reflect a strong management commitment to maintaining credit quality, while the company continues to make significant infrastructure-related acquisitions. -0- RATINGS AFFIRMED Jersey Central Power and Light Co. Corp credit rtg BBB+ Sr secd debt BBB+ Pfd stk BBB Metropolitan Edison Co. Corp credit rtg BBB+ Sr secd debt BBB+ Sr unsecd debt BBB Pfd stk BBB Pennsylvania Electric Co. Corp credit rtg A- Sr secd debt A- Pfd stk BBB+ CONTACT: Richard W. Cortright, 212/208-1657 For more information on criteria or subscriptions: http://www.ratings.standardpoor.com |
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