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SPS WITHDRAWS PROPOSAL TO PALO VERDE LEASE-DEBT HOLDERS

 AMARILLO, Texas, July 28 /PRNewswire/ -- Southwestern Public Service Company (NYSE: SPS) announced that as of 7 p.m. Central time today it has withdrawn its proposal to the Palo Verde lease-debt holders in the El Paso Electric bankruptcy case because of the group's failure to formalize its support for SPS with the bankruptcy court. SPS continues to be interested in this acquisition and is considering various alternatives with respect to its proposed plan of reorganization for EPE, which was publicly announced July 1.
 On July 12, the holders of a majority in principal amount of the Lease Obligation Bonds and Secured Lease Obligation Bonds issued in connection with EPE's interest in the Palo Verde Nuclear Generating Station announced their intention to support the SPS plan, but the group delayed finalizing that support. The SPS proposal included recoveries of 98 percent of the lease debt's face value, plus carrying costs.
 "We had an excellent proposal to the lease-debt group on the table," said SPS chairman Bill D. Helton. "Our $2.2 billion proposal provided outstanding recoveries for creditors, while allowing SPS to stand by its less costly rate path for EPE electric customers. We felt it was time for the lease-debt group to move forward and file its support at the bankruptcy court in Austin."
 Southwestern Public Service Company primarily provides electric service to a population of about one million in a 52,000-square-mile area of eastern and southeastern New Mexico, the South Plains and Panhandle of Texas, the Oklahoma Panhandle and southwestern Kansas.
 -0- 7/28/93
 /CONTACT: Phil Roth, public information supervisor, 806-378-2120 or Jim Steinhilper, group manager of finance, 806-378-2843, both of Southwestern Public Service Company/
 (SPS)


CO: Southwestern Public Service Company ST: Texas IN: OIL SU:

TM -- NY128 -- 7031 07/28/93 20:24 EDT
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Publication:PR Newswire
Date:Jul 28, 1993
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