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ENTERGY AND GULF STATES UTILITIES ANNOUNCE DEFINITIVE AGREEMENT TO COMBINE; GSU SHAREHOLDERS TO RECEIVE $20 PER SHARE IN CASH OR STOCK

 ENTERGY AND GULF STATES UTILITIES ANNOUNCE DEFINITIVE AGREEMENT TO
 COMBINE; GSU SHAREHOLDERS TO RECEIVE $20 PER SHARE IN CASH OR STOCK
 NEW ORLEANS, June 8 /PRNewswire/ -- Entergy Corporation (NYSE: ETR) and Gulf States Utilities Company (NYSE: GSU) today announced that the two companies have entered into a definitive agreement providing for the combination of Entergy and GSU. In the combination, GSU common shareholders will receive $20 per share in cash or stock and the aggregate consideration to be paid to GSU common shareholders will be approximately $2.3 billion.
 Under the terms of the agreement, which was unanimously approved by the boards of directors of both companies, Entergy and GSU will form a new holding company which will acquire all of the common stock of Entergy and GSU. The new holding company, which will be renamed "Entergy," will own all of the stock of GSU and Entergy's operating subsidiaries.
 In the combination, GSU common shareholders can elect to receive $20 in either cash or shares of common stock of the new holding company for each share of GSU common stock. The price will be increased if the transaction has not been consummated by June 5, 1994, to account for the dividends from and after June 5, 1994, that GSU's common shareholders would have received if the transaction had been consummated prior to such date, but not less than 25 cents per share per quarter. Similarly, the price will be decreased on a dollar-for-dollar basis to reflect any dividends paid by GSU on its common stock during the period from the date of the agreement to the closing. The maximum amount of cash to be paid to GSU common shareholders pursuant to the agreement is $250 million, and the agreement provides for the proration of cash in the event that GSU shareholders elect, in the aggregate, to receive more cash than the $250 million specified above. Each of the shares of GSU preferred stock outstanding at closing will survive the closing as outstanding stock of GSU. Each share of Entergy common stock will be converted into the right to receive one share of holding company common stock.
 It is anticipated that the transaction will be tax-free to Entergy's common shareholders and to GSU's common shareholders to the extent they elect to receive stock. The offer price for the GSU common stock represents a 38 percent premium over the closing price of GSU common stock on June 5, 1992, the last trading day before announcement of the transaction.
 Completion of the transaction is subject to, among other things, the approval of the common shareholders of Entergy and GSU and the receipt of all required governmental and regulatory approvals. These regulatory approvals include approval of the Louisiana Public Service Commission, the Public Utility Commission of Texas, the Federal Energy Regulatory Commission, the Securities and Exchange Commission, and the Nuclear Regulatory Commission. The regulatory process could take at least 12 to 18 months.
 "Combining the two companies is a win-win opportunity for all key constituents, including customers, employees, shareholders and regulators," said Edwin Lupberger, Entergy chairman and CEO, and Joseph L. Donnelly, GSU chairman of the board and CEO.
 Lupberger and Donnelly said the combination of GSU and Entergy will create a more competitive and efficient company that will add a new dimension to GSU's well-known emphasis on economic development activities in Southeast Texas and South Louisiana.
 Lower energy costs and flat rates for five years or longer are certain to be strong inducements for businesses to locate in the GSU area or expand their operations already in place, they said.
 The lower customer bills will be the result of fuel-cost savings, operational advantages and cost efficiencies gained from creating a larger four-state network with numerous synergies in electrical operations and business practices.
 Salomon Brothers Inc. is serving as the financial advisor for Entergy, and Goldman, Sachs & Co. is serving as the financial advisor for GSU.
 GSU provides electric service to about 579,000 electric customers throughout a 28,000 square mile area of Southeast Texas and South Louisiana. Revenues in 1991 amounted to about $1.7 billion.
 Entergy's retail operating companies currently serve more than 1.7 million customers across an 84,000 square mile area in parts of Arkansas, Louisiana and Mississippi. The Entergy companies serving those areas are Arkansas Power & Light Company, Louisiana Power & Light Company, Mississippi Power & Light Company and New Orleans Public Service Inc. Entergy, whose 1991 sales amounted to $4 billion, employs 12,500 people.
 -0- 6/8/92
 /CONTACT: Cyril Guerrera (media), 504-569-4238, or Rick Strawn (investor), 504-569-4360, both of Entergy Corporation; or Kim McMurray of Gulf States Utilities Co., 409-839-2890/
 (ETR GSU) CO: Entergy Corporation; Gulf States Utilities Company ST: Louisiana, Texas IN: OIL SU: TNM


PS -- NY036 -- 7837 06/08/92 10:56 EDT
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Date:Jun 8, 1992
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