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TEXAS PUBLIC UTILITY COMMISSION GIVES INTERIM APPROVAL TO ENTERGY/GULF STATES UTILITIES MERGER

 AUSTIN, Texas, July 22 /PRNewswire/ -- The Public Utility Commission of Texas (PUCT) Wednesday unanimously gave interim approval to the proposed merger of Entergy Corporation (NYSE: ETR) and Gulf States Utilities Company (NYSE: GSU), describing it as a transaction that is in the public interest and beneficial to customers and other major public groups.
 The companies had requested an interim order because other regulatory agencies are also considering the merger. The PUCT will make its final ruling after the other agencies rule on the transaction.
 The commission based its order on the recommendations submitted by Administrative Law Judge Kathleen Sanford, who presided at hearings and other proceedings held over the past 12 months. The order tracked the provisions of a settlement agreement that was jointly offered by the companies and several other parties in the PUCT proceeding several months ago. Joining in offering the settlement proposal were Entergy, GSU, the staff of the PUCT, IBEW Local 2286, and the Texas Industrial Energy Consumers. Two other parties that did not join in offering the agreement but instead submitted letters indicating they did not oppose it were the Texas Office of Public Utility Counsel, which represents residential and small commercial customers, and a group of cities served by GSU.
 Sanford's 100-page opinion, submitted to the commission June 25, described various benefits of the merger as follows, "The merger of GSU and Entergy is reasonable, will provide a benefit to the ratepayers, will not unreasonably affect GSU's rates or services, will not adversely affect GSU's financial condition, and is, therefore, consistent with the public interest."
 She also commented favorably on Entergy's offer of $20 for each share of GSU common stock. "Taking into consideration the savings that will result from the transaction and the non-quantitative factors involved in determining the purchase price, the price to be paid by Entergy for GSU constitutes a reasonable value," she said.
 She additionally noted that, "Following GSU's merger with Entergy the (Texas Public Utility) Commission will retain jurisdiction...over GSU's Texas operations and its affiliates."
 The PUCT order requires that GSU customers in Texas must receive all fuel savings attributed to GSU's Texas operations, effective the day the merger closes. It also provides for customers and shareholders to receive roughly equal allocations of non-fuel operations and maintenance savings created by the merger in Texas for an 8-year period, after which all such savings accrue to customers.
 The companies estimate that customers of the entire GSU system will receive approximately $790 million in fuel savings and more than $250 million in non-fuel savings during the first 10 years of the merger, with the amounts splitting roughly one-half for Texas customers and one- half for Louisiana customers.
 The companies have also agreed to a 5-year cap on GSU's retail base rates at the level in effect on the merger closing date. The rate cap would prohibit any increase in GSU base rates during the five years following closing of the merger except for increases arising from certain extraordinary circumstances that would qualify as "force majeure" events.
 The merger proposal previously received conditional approval from the Louisiana Public Service Commission. Proceedings to secure approval are pending before the Federal Energy Regulatory Commission, the Securities and Exchange Commission and the Nuclear Regulatory Commission.
 -0- 7/22/93
 /CONTACT: Media: Cyril Guerrera, 504-569-4411, or Analysts: Stuart Ball, 504-569-4817, both of Entergy; or Kim McMurray of Gulf States, 409-839-2890/
 (ETR GSU)


CO: Entergy Corporation; Gulf States Utilities Company; Public Utility
 Commission of Texas ST: Louisiana, Texas IN: UTI SU: TNM


BR-BN -- AT005 -- 4445 07/22/93 10:43 EDT
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Date:Jul 22, 1993
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