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PHILADELPHIA ELECTRIC COMPANY ANNOUNCES INVITATION TO BONDHOLDERS

   PHILADELPHIA ELECTRIC COMPANY ANNOUNCES INVITATION TO BONDHOLDERS
    PHILADELPHIA, Nov. 7 /PRNewswire/ -- Philadelphia Electric Company (NYSE:PE) announced today an invitation to bondholders:
      "Modified Dutch Auction" Applies to Holders of $286,000,000
      Montgomery County Industrial Development Authority Pollution
         Control Revenue Bonds 1985 Series A and 1985 Series B
                (Philadelphia Electric Company Project)
    Philadelphia Electric Company (the "company")  announced today that it has invited holders of certain pollution control revenue bonds to submit offers to sell for cash any and all of their Bonds to the company.  Offers by Bondholders are to be at purchase prices designated by them and will be accepted by the company on a "Modified Dutch Auction" basis.
    The invitation applies to holders of Montgomery County Industrial Development Authority Pollution Control Revenue Bonds (Philadelphia Electric Company Project) 10-1/2 percent 1985 Series A due 2015 (CUSIP 613609 GU 4) and 10-1/2 percent 1985 Series B due 2014 (CUSIP 613609 HG 4).  The Invitation expires at 5 p.m. New York City time on Friday, Dec. 6, 1991, unless terminated earlier or extended.  Bonds offered to the company must be tendered to Manufacturers Hanover Trust Company, the Depositary.
    The Dealer Manager for the invitation is Bear, Stearns & Co. Inc., a wholly owned subsidiary of The Bear Stearns Companies Inc.  The Information Agent is Georgeson & Company Inc.
    Under a "Modified Dutch Auction" procedure, the company will pay to each holder of the Bonds whose offer is accepted the highest price offered for the Bonds of such series and accepted by the company even if that price is higher than the price offered by such holder.  Holders of the Bonds will not be obligated to pay any fees to the Dealer Manager or soliciting brokers.
    The company is not obligated to accept any offers and, if offers are accepted, the acceptance price for each series will be determined solely by the company.  The company may announce a maximum acceptable price for each series of Bonds prior to the termination of the invitation.  If the company announces maximum acceptable prices, a holder of the Bonds whose offer was made at a higher price may change its offer to a lower price.
    The invitation is subject to certain conditions, including the issuance by Montgomery County Industrial Development Authority of pollution control revenue refunding bonds in a principal amount equal to the principal amount of Bonds to be purchased.
    The company is inviting offers to purchase the Bonds because they are not presently subject to optional redemption.  The 10-1/2 percent Series A Bonds will become subject to optional redemption on May 15, 1995 at 103 percent of par.  The 10-1/2 percent Series B Bonds will become subject to optional redemption on Oct. 1, 1995 at 103 percent of par.  The company currently expects, subject to necessary approvals, to redeem the Bonds on such dates.  The company may also consider, prior to such dates, other options that would require that Bonds not purchased be redeemed on such dates regardless of market conditions.
    The company has been active in refinancing high-cost debt and preferred stock.  Since 1985, the company has refunded more than $1.6 billion resulting in an annual interest and preferred stock dividend savings of $66 million.  This "Dutch Auction" offering is another step in this process.
    /delval/
    -0-                        11/7/91
    /CONTACT:  Neil McDermott of Philadelphia Electric, 215-841-4122, or Fabianne Gershon of Bear Stearns, 2l2-272-2400/
    (PE) CO:  Philadelphia Electric Company ST:  Pennsylvania IN:  UTI SU: JS -- PH033 -- 2416 11/07/91 17:09 EST
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Publication:PR Newswire
Date:Nov 7, 1991
Words:585
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