DUFF & PHELPS: UTILICORP UNITED INC. $125 MILLION SENIOR UNSECURED NOTES RATED 'BBB'
CHICAGO, Feb. 25 /PRNewswire/ -- Duff & Phelps Credit Rating Co. today assigned a rating of "BBB" (Triple-B) to UtiliCorp United Inc.'s offering of $125 million of senior unsecured notes. Proceeds will be used to reduce short-term debt. UtiliCorp United has made significant capital outlays to fund its growth and diversification program. In November, UtiliCorp announced plans to purchase a gas distribution system in Nebraska from Arkla Inc. The acquisition fits the long-term strategy of UtiliCorp to make acquisitions that have a positive impact on growth. UtiliCorp has sold common equity, as needed, to support capital ratios and coverages. The issuance of new common equity is expected within the next year. Increased reliance on non-utility sources to provide a larger portion of future consolidated earnings is an opportunity for increased profitability, but does carry a greater element of uncertainty. Nonregulated energy businesses have grown to represent over one-fourth of UtiliCorp's earnings and about one-third of total capital. Charges recorded in 1992 related to Aquila Energy, the nonregulated subsidiary, appear to be one-time. A revised business strategy for Aquila Energy includes a conservative drilling program and closer matching of long- term gas sales contracts with reserves. UtiliCorp United Inc. has seven electric and/or gas divisions operating in eight states; a subsidiary operates in Canada. Utility operations account for the majority of operating income. UtiliCorp's nonregulated subsidiaries include Aquila Energy, a natural gas producer and marketer, and UtilCo Group, Inc., which participates in the development of generation in the independent and wholesale power market. -0- 2/25/93 /CONTACT: John C. Dell of Duff & Phelps Credit Rating Co., 312-368-3161/ (UCU)
CO: UtiliCorp United Inc. ST: IN: UTI SU: RTG
TS -- NY078 -- 0506 02/25/93 15:35 EST
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|Date:||Feb 25, 1993|
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