Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: X Y Zebra who wrote (5717)	10/8/2002 6:42:34 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 57110

"an obvious point" ahem, my speciality. <g> more crooks turning on fellow crooks??? Allegheny Energy Defaults on Loans 10/08/2002 16:59:04 EST HAGERSTOWN, Md. (AP) - Utility holding company Allegheny Energy Inc. Tuesday said that it was in default on some of its loans, after it failed to post additional collateral following a credit downgrade. Allegheny also said that because of continued weakness in the wholesale energy market, fiscal 2002 and 2003 earnings will be lower than expected. Moody's Investor Service last week downgraded the company's credit rating to "junk" status. At the time, Allegheny said that Moody's action wouldn't trigger any defaults or prepayment obligations under its debt agreements. Allegheny has entered talks with lenders to try to obtain default waivers and extra funding. Shares of the company plummeted on the news. They closed at $3.80 on the New York Stock Exchange, down $3.72, or 49 percent, on heavy volume. The day's weakest level of $3.25 was a new 52-week low. Allegheny's prior low of $7.52 was set Monday. Allegheny, which is based in Hagerstown, offers electricity and natural-gas service in Maryland, Ohio, Pennsylvania, Virginia and West Virginia. In July, Allegheny stood by its 2002 earnings outlook of $2.50 to $2.70 a share, and its 2003 forecast of $2.60 to $2.80 a share. Analysts surveyed by Thomson First Call are looking for the company to earn $2.28 a a share this year and $2.19 a share in 2003. Allegheny, like most of the power industry, has been forced to cut capital spending and lay off employees because of weak earnings due to poor power prices, among other factors. Last month, Allegheny filed a lawsuit against Merrill Lynch & Co., alleging that Merrill inflated revenue of an energy-trading unit through a series of so-called wash trades with Enron Corp. before the business was sold to Allegheny in 2001. The lawsuit was filed the day after Merrill filed suit in federal court seeking to collect the $115 million that Allegheny allegedly owes the firm as part of the deal.