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NERCO MAKES MANAGEMENT CHANGES; OBTAINS DEBT AGREEMENT WAIVERS; SUSPENDS ITS QUARTERLY DIVIDEND

 PORTLAND, Ore., Nov. 16 ~PRNewswire~ -- PacifiCorp (NYSE: PPW) and NERCO Inc. (NYSE: NER; Toronto) today announced the resignations of Lawrence E. Heiner, president and chief executive officer, and Linda S. Rogers, senior vice president of NERCO Inc.
 The NERCO Inc. board of directors today elected its chairman of the board, Gerard K. Drummond, as chief executive officer, and William J. Glasgow as president of the natural resources company.
 Drummond, who served as chief executive officer of NERCO from its organization in late 1976 until February 1992, will continue as executive vice president of PacifiCorp. Glasgow will also continue to retain his positions as an officer of PacifiCorp and various of its affiliates.
 Drummond stated that he, Glasgow and the rest of the management team intend to complete an evaluation of the company's current businesses, further develop and implement strategic plans for the company and assess future management needs, all with the goal of restoring NERCO to profitability as soon as possible.
 NERCO also reported that its board of directors considered but did not declare a dividend at the regular quarterly meeting today. NERCO's debt agreements contain restrictive covenants that, among other things, limit the payment of dividends. Due to losses recorded in the third quarter, at Sept. 30, 1992, only $4.3 million was available for payment of dividends. On Nov. 12, 1992, the company obtained a waiver of the covenant in its principal debt agreement that restricts the payment of dividends to allow the company's board of directors to consider declaration of a quarterly dividend of up to 16 cents per share, or an aggregate of $6.3 million, at this quarterly meeting. The waiver does not apply to future dividends.
 According to Drummond, "In light of uncertainties concerning the possible sale of our minerals subsidiary and the company's determination to reduce debt to improve its financial flexibility, the board decided to suspend the payment of quarterly dividends. The board will again review the dividend at its next regular quarterly meeting in February 1993."
 NERCO has also obtained waivers of the $525 million minimum net worth and debt to total capitalization requirements of its principal debt agreement as of Dec. 31, 1992, in connection with the possible disposition of its minerals subsidiary. NERCO may need to obtain additional waivers or an amendment of these requirements for subsequent periods.
 NERCO is a diversified natural resource company with interests in low-sulfur coal, oil and natural gas, and precious metals. Approximately 82 percent of NERCO's common stock is beneficially owned by PacifiCorp.
 -0- 11~16~92
 ~CONTACT: John C. Cummings, 503-731-6649, or Scott A. Hibbs, 503-731-6723, both of NERCO; or Mike Nelson, 503-731-2125, or Chris Hunter, 503-731-2090, both of PacifiCorp~
 (NER PPW)


CO: NERCO Inc.; PacifiCorp ST: Oregon IN: MNG SU: PER DIV

JH -- SE011 -- 1557 11~16~92 18:01 EST
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Publication:PR Newswire
Date:Nov 16, 1992
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