NRG files to sell up to $2 billion in securities
Melissa Levy
Star Tribune
Friday, June 15, 2001
NRG Energy Inc., which has seen its stock dip 17 percent this year, filed with the Securities and Exchange Commission Thursday to sell up to $2 billion of securities.
Shares of the Minneapolis-based independent power company closed Thursday at $23.20, down $1.24, or 5 percent.
NRG is seeking SEC approval to use a "shelf registration process" that would allow it to sell securities separately or in units, with one or multiple offerings. The company
said that it plans to use the proceeds for "general corporate purposes," which might include the development of new facilities.
Its filing noted that the timing and amount of the securities sales would depend on "market conditions and the availability to us of other funds."
An NRG spokeswoman could not be reached Thursday for further comment.
The utility sector has been hit hard by investors in recent weeks, especially unregulated companies such as NRG, said Andre Meade, an analyst with Commerzbank
Securities in New York City.
The reason is twofold, he said. First, mild weather on the East and West coasts has led to lower demand and softer prices. And in California, there is continued talk about
price controls -- with federal support perhaps more likely with the recent political party power shift in Washington, D.C.
NRG's share drop on Thursday may be attributed to worries by some investors that the sale of additional securities would dilute their investment. "In my view, it doesn't
make much sense," Meade said.
Separately Thursday, NRG announced that one of its subsidiaries opened a 49-megawatt electric generation plant in central California. The company said that the plant,
in Chowchilla, Calif., can generate enough power for about 50,000 homes.
-- Melissa Levy is at mlevy@startribune.com .
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