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ILLINOIS POWER COMPANY $110 MILLION NEW MORTGAGE BONDS RATED 'BBB' BY DUFF & PHELPS

 CHICAGO, Oct. 28 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned a rating of `BBB' (Triple-B) to Illinois Power Company's proposed $110 million offering of new mortgage bonds. Proceeds will be used to redeem or repurchase outstanding securities.
 Illinois Power's credit measures have improved due to rate relief, cost controls, and significant debt and preferred stock refunding and retirements. Continued improvement is anticipated as strong cash flow and manageable construction requirements minimize the need for external financing. Construction expenditures will be fully funded by internal cash.
 As expected, a September 1993 Illinois Court of Appeals decision upheld a previous rate order, requiring Illinois Power to write-off $195 million in the third quarter and refund $8.5 million. Although this resulted in a negative retained earnings balance, the company should be able to accumulate retained earnings sufficient to offset the write-off. Preferred dividends have been pre-declared through the second quarter of 1994.
 Illinois Power intends to comply with clean air regulations by purchasing emission allowances. Agreements have been reached with several utilities for the purchase of the allowances required for Phase I. The allowance purchase strategy permits construction of scrubbers at the Baldwin plant to be delayed until Phase II.
 Illinois Power Company is the second largest electric utility in the state of Illinois. Its service area is a widely diversified industrial and agricultural area comprising about 15,000 square miles in northern, central and southern Illinois and having an aggregate population of approximately 1.3 million.
 -0- 10/28/93
 /CONTACT: John C. Dell of Duff & Phelps Credit Rating Co., 312-368-3161/


CO: Illinois Power Company ST: Illinois IN: UTI SU: RTG

TS -- NY100 -- 7982 10/28/93 13:44 EDT
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Publication:PR Newswire
Date:Oct 28, 1993
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