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Gold/Mining/Energy : CPN: Calpine Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Clement who wrote (210)	12/15/2001 12:48:57 PM
From: Nazbuster	Read Replies (1) \| Respond to of 555

Gary B. Smith picked CPN as a long on today's Fox show... He thought it was a classic panic oversold situation.

To: Clement who wrote (210)	12/16/2001 1:52:57 AM
From: Winkman777	Respond to of 555

Barron's article From the *Current Yield" column The junk and convertible bond markets tried all week to decipher whether independent power producer Calpine was another Enron, the fallen energy trader. But by week's end, the speculation abated, after Calpine held a conference call, put out a press release and even bought back some of its $1 billion in zero-coupon convertible debt, helping those securities rebound somewhat. "I think Enron scared a lot of people and it left many with a bad experience," says James Didden, vice president and investment officer at J.W. Seligman. Calpine's actions last week stemmed from a Sunday New York Times article, which drew parallels to Enron, which Didden says "really created more fear in the marketplace." Calpine's 8 1/2% senior notes of 2008 and 2011, which were trading roughly 94 cents on the dollar prior to the article, were down 11-15 points on Monday and spiraled into the high 60s and low 70s on Wednesday morning. Concurrently, Calpine's zeros, puttable for cash and stock next April 30, fell as low as 85 cents on the dollar, producing an astounding yield to that put date of 47%. But late Wednesday, the converts got a boost after Calpine bought back $122 million of the issue, trading up to 91 1/2, with a yield to put of 24.5%. The zeros ended the week at 93 1/2, with a yield to put of 19.66%, according to ConvertBond.com. "Enron was a trading business while Calpine has real assets," Didden says. "Its primary business is that of a power generator and it does do some trading to augment that business ... Calpine and Enron are arguably two different businesses." Many investment-grade and crossover investors were major sellers after the Enron meltdown. Standard & Poor's affirmed Calpine's double-B-plus rating on Wednesday, while Moody's Investors Service cut Calpine's Baa3 senior unsecured debt rating to Ba1 late Friday and placed it on review for further downgrade "pending arrangements to obtain additional financing." Moody's move comes on the heels of harsh market criticism that the ratings agencies moved too slowly in downgrading Enron to junk. Moody's had just upgraded Calpine to investment grade in October. Nonetheless, Calpine's straight debt, which was trading in the low 80s late Wednesday, dropped to 73 bid, 77 asked after the Moody's announcement late Thursday. They bounced back to 77-80 hours later, but closed Friday around 75 before Moody's downgrade. Anand Iyer, head of global convertible research at Morgan Stanley, points out that "at Calpine's current [convertible] price, one can say is that unless the stock recovers dramatically or interest rates go down substantially, the likelihood is very high that the bonds will be put back." Calpine's stock was under selling pressure all week on the expectation that the firm likely will pay investors back in stock, instead of cash, creating massive dilution in the event $878 million outstanding converts are redeemed. Calpine's stock plunged to 13.20 Friday. At that price , investors would want to put the bonds back to the company because the value of the convertible security put back to the company at par is greater than the trading price of the security at the current mid-90s. Calpine's 52-week high and low are 58.04 and 10, respectively.

To: Clement who wrote (210)	12/17/2001 3:02:43 PM
From: Winkman777	Respond to of 555

Calpine,Calif Meet On Power Pacts, No Agreement Reached Dow Jones Business News 12/17/01 12:54PM LOS ANGELES -(Dow Jones)- Calpine Corp. (CPN) and California state officials held extensive talks last week in an effort to renegotiate billions of dollars in long-term power supply contracts the San Jose-based energy company signed with the state last spring, spokesmen for the state and Calpine said Sunday. The parties haven't reached agreement on how the contracts, currently worth an estimated $13 billion, will be restructured, but an announcement could be made as soon as this week, Calpine spokeswoman Katherine Potter said. "We did have some very good meetings with the state, but nothing is definitive yet," Potter said. Concluding the renegotiations would give California a better deal and allow Calpine to showing Wall Street more certainty regarding its revenue stream from the forward contracts, Potter said. "We're confident everyone will see this as positive step," Potter said. Steve Fleishman, an analyst with Merrill Lynch in New York, agreed that concluding the renegotiations would be a "good thing" for Calpine, because it would remove uncertainty. "If the contracts are renegotiated sooner it could be a positive first step for Calpine," Fleishman said. Late Friday, Moody's Investors Service downgraded Calpine's debt ratings one notch to junk status, citing the company's heavy debt load, limited financial flexibility and "modest" operating profits at a time when Calpine is aggressively building up its generation portfolio. Calpine operates 69 power plants with 12,000 megawatts of capacity and is in the process of building an additional 30 power plants with that will add 17,800 MW. The company plans to bring 70,000 MW of generation on line by 2005. Senior Calpine officials and officials with the California Department of Water Resources, the agency buying power in lieu of California's struggling utilities, met for several hours on the contracts beginning last Thursday. People close to the discussions said Calpine would agree to trim the length of the contracts in exchange for higher cash payments up front. The state is looking at other ways to reduce the costs of the contracts, these people said. Steve Maviglio, spokesman for Gov. Gray Davis, said the state and Calpine were engaged in serious discussions last week but were working to finalize an agreement. "The state and Calpine were in heavy talks, but no deal has been finalized," Maviglio said. Calpine holds the bulk of $42 billion in long-term power pacts California signed with about 29 energy companies in the spring. Two of those contracts commit Calpine to provide up to 2,000 megawatts of electricity from new and existing power plants over the coming decade. The company will also supply up to 735 megawatts of power when demand is highest from 15 new "peaker" plants through two separate agreements. California entered into the power pacts at an average price of $70 a megawatt hour earlier this year after soaring power prices left the state's largest utilities unable to pay their bills. The power market has since crashed, and Davis has been criticized for locking consumers into expensive contracts running as long as 20 years. The state now has a surplus of power that it expects to sell off at a loss of 80 cents on the dollar, which could cost consumers about $4 billion over the next decade, according to a report by the Department of Water Resources. DWR officials approached Dynegy Inc. (DYN) last week and Sempra Energy Resources, a unit of Sempra Energy, last month to try and renegotiate the contracts the state signed with those companies. Steve Stengel, a spokesman for Dynegy said talks haven't taken place. Doug Kline, a spokesman for Sempra, wouldn't say whether Sempra has met with state officials.