Lehman Brothers Collection - Contemporary Business Archives

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Twentieth-Century Business Archives

Atlantic City Electric Co. Deal - Lehman Brothers Collection

Atlantic City Electric Co.

Company DealAtlantic City Electric Company: 750,000 shares of common stock ($3 par value) issued April 22, 1971, and $27,000,000 first mortgage bonds 8% series due 2001 dated May 1, 1971, and issued May 6, 1971
Transaction TypeFirst Mortgage Bonds
Deal DescriptionAtlantic City Electric Company was to apply the net proceeds from this deal, to the extent necessary, to the prepayment of outstanding notes payable to banks, which totaled $32,000,000 as of April 20, 1971. After the application of proceeds from a sale of additional common stock on April 27, 1971, the outstanding notes payable to banks totaled only $15,000,000. Proceeds from such notes payable to banks were used to pay for part of the 1970 and 1971 construction programs. The balance of the net proceeds from this sale, estimated at $8,000,000, was to be used to pay for part of the cost of the 1971 construction, which involved the construction of production facilities and additional substations, as well as improvements to and extensions of the company's transmission and distribution system. The cost of the construction program for 1971 was estimated to be $60,100,000. The total projected construction project cost for 1972 and 1973 was $100,000,000. The company installed a jet-powered turbo-generator at one of its stations in 1971 and expected to install additional units the following year. Atlantic City Electric was participating with Delmarva Power & Light Company, Philadelphia Electric Company, and Public Service Electric and Gas Company in the development and proposed ownership as tenants in common of two 1,065,000 kilowatt units of a nuclear-generating station as well as a two-unit 2,205,000 kilowatt nuclear-generating station. The company also planned to install an additional fossil-fueled unit at one of its generating stations in 1974. The bonds from this sale became due on May 1, 2001.
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