-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N83/tX8Yhb0wNwlGYXXKNsKx8gQqhCr/qHUHdaKjW3V9GJqXTbGGfNUMP187S2u/ fu7YspU4XL+WaSJISJHp2A== /in/edgar/work/0000895813-00-000409/0000895813-00-000409.txt : 20001011 0000895813-00-000409.hdr.sgml : 20001011 ACCESSION NUMBER: 0000895813-00-000409 CONFORMED SUBMISSION TYPE: 425 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20001010 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: COLUMBIA ENERGY GROUP CENTRAL INDEX KEY: 0000022099 STANDARD INDUSTRIAL CLASSIFICATION: [4923 ] IRS NUMBER: 131594808 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 425 SEC ACT: SEC FILE NUMBER: 001-01098 FILM NUMBER: 737748 BUSINESS ADDRESS: STREET 1: 13880 DULLES CORNER LANE STREET 2: SUITE 300 CITY: HENDERON STATE: VA ZIP: 20171-4600 BUSINESS PHONE: 7035616000 MAIL ADDRESS: STREET 1: 13880 DULLES CORNER LANE STREET 2: SUITE 300 CITY: HERNDON STATE: VA ZIP: 20171-4600 FORMER COMPANY: FORMER CONFORMED NAME: COLUMBIA GAS SYSTEM INC DATE OF NAME CHANGE: 19920703 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: NEW NISOURCE INC CENTRAL INDEX KEY: 0001111711 STANDARD INDUSTRIAL CLASSIFICATION: [ ] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 425 BUSINESS ADDRESS: STREET 1: 801 EAST 86TH AVE CITY: MERRILLVILLE STATE: IN ZIP: 46410 BUSINESS PHONE: 2196475200 MAIL ADDRESS: STREET 1: 801 EAST 86TH AVE CITY: MERRILLVILLE STATE: IN ZIP: 46410 425 1 0001.txt Filed by: New NiSource Inc. Pursuant to Rule 425 under the Securities Act of 1933 Subject Company: Columbia Energy Group Registration Statement File No: 333-33896 On October 10, 2000, NiSource made a presentation to analysts. The text of slides which were displayed as part of the analyst presentation is set forth below. TEXT OF SLIDES PRESENTED AT ANALYSTS PRESENTATION OCTOBER 10, 2000 [NiSource logo] [Columbia Energy Group logo] BUILDING VALUE IN OUR ENERGY CORRIDOR OCTOBER 2000 These materials contain forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934, including statements about future business operations and financial performance. These statements involve risks and uncertainties inherent in business forecasts, and actual results could differ materially from those indicated in these statements. A number of these risks and uncertainties are discussed in NiSource's Form 10-Q Quarterly Report filed with the Securities and Exchange Commission on August 14, 2000. WE ARE DELIVERING.... 1 ====================================================================== OUR MERGER WITH COLUMBIA ENERGY GROUP CREATES THE PREMIER COMPETITOR IN OUR ENERGY CORRIDOR * The merger is expected to close on or about November 1st -- Fastest approval process for a registered holding company (eight months) -- Positive response from state regulators * Stock has outperformed the other diversified gas distribution companies and the broader market since announcement -- Expect full stock subscription due to superior economics * Successful asset sale program -- Approximately $745 MM of asset sales have been completed or announced YTD -- Additional asset sales up to $725 MM expected to be completed by Q1 2001 * Smooth integration process - Project Compass -- Existing management team has become stronger -- Confident in synergy estimates * Positive interest rate/financing environment ********************************************************************** * NiSource presents a compelling valuation opportunity * * at the current level * ********************************************************************** TO BUILD THE PREMIER ENERGY COMPETITOR... 2 ====================================================================== * Largest natural gas company in our high growth Energy Corridor -- 3.2 MM customers in 9 states * Superior knowledge base -- Skill set spans the full energy value chain * Positioned for superior financial performance -- 10%+ EPS growth [Map of Eastern United States showing high growth Energy Corridor] BY TAKING THE BEST OF BOTH WORLDS... 3 ======================================================================
***************************** * Gary L. Neale * * Chairman, President & CEO * ***************************** * *************************** * * * *********************** * * Stephen P. Adik * * * Vice Chairman * * *********************** * * * ************************************** * * * * *********************** * * * Michael W. O'Donnell* * * * Executive V.P. & CFO* * * *********************** * * * * * ************************************************************************************ * * * * * * * ****************** ********************* ******************** ******************* ******************* ******************** *Jeffrey W. Yundt* *Catherine G. Abbott* *Patrick J. Mulchay* * Joseph L. Turner* * Mark D. Wyckoff * * Stephen P. Smith * * President * * President * * President * * President * * President * * President * * Energy * Pipeline * * Merchant * * Primary * * New Energy * * Business * * Distribution * * Operations * * Energy * * Energy, Inc. * * Businesses * * Services * ****************** ********************* ******************** ******************* ******************* ******************** *Gas and electric *Gas transmission *Gas supply and *Industrial power *Distributed *Administrative and distribution *Telecom storage generation generation shared services *E&P *E-commerce *Electric generation *Wholesale energy trading
MAXIMIZING EFFICIENCY OF THE NEW COMPANY... 4 ====================================================================== (Dollars in Millions) Revenue Cost Year Enhancements Synergies Total ---- ------------ --------- ----- 2001 $1.5 $96.1 $98 2002 $7.7 $133.3 $141 2003 $11.5 $144.5 $156 2004 $15.8 $158.2 $174 2001 2002 2003 2004 ---- ---- ---- ---- Cost Savings % of Pro Forma Combined Non-Fuel O&M 5.8% 8.1% 8.6% 9.4% Cost Savings % of Columbia Non-Fuel O&M 9.6% 13.2% 14.2% 15.6% SUCCESSFULLY DIVESTING NON-CORE ASSETS... 5 ====================================================================== PRE-TAX PROCEEDS ($MM) TIMING SALES ANNOUNCED: Market Hub Partners $250 Completed Columbia LNG 150 Completed Columbia Retail 44 Completed Columbia Electric 300 Q4 2000 ---- $744 Sales in Progress(1): Up to $725 Q4 2000 - Q1 2001 (1) Sales in progress includes Columbia Propane, Columbia Petroleum, IWCR, Miller Pipeline and other unregulated businesses. AND EXECUTING A BALANCED FINANCING PLAN... 6 ====================================================================== ---------------------------------------------------------------------- SOURCES AND USES(1) ---------------------------------------------------------------------- $MM % ------- ------ Sources Debt $2,574 45% SAILS[SM](2) 106 2% Asset Sales/Cash 1,363 23% Common Equity 1,762 30% ---------------------- ------ ---- Total $5,805 100% Uses Purchase Consideration Cash $3,887 67% Stock 1,762 30% SAILS[SM](2) 106 2% Transaction Costs 50 1% ---------------------- ------ ---- Total $5,805 100% (1) Assumes 30% stock election and asset sales applied to reduction of debt. (2) Reflects fair market value assumption of $1.90 per SAILS. ---------------------------------------------------------------------- STRUCTURE ---------------------------------------------------------------------- NiSource * * * *********************************************** * * * * * * * * * Columbia Energy NIPSCO Bay State Gas Group DIVERSIFY OUR EARNINGS AND GROWTH PROFILE... 7 ====================================================================== [Graphs displaying the following data:] NiSource Stand-Alone NiSource Pro Forma LTM EBIT LTM EBIT June 30, 2000(1) June 30, 2000(1)(2) ------------------------- ------------------------- Electric - 70% Gas Distribution - 32% Gas Distribution - 25% Electric - 32% Other - 5% Gas Transmission - 30% E&P - 6% (1) Excludes corporate overhead and synergies. (2) Reflects disposition of non-core assets. ********************************************************************** * A Full Service Energy Company * ********************************************************************** MAXIMIZE SHAREHOLDER VALUE... 8 ====================================================================== ********************************************************************** * ... With a Low Risk / High Growth Strategy * ********************************************************************** * Regulated Businesses -- Positive regulatory relationships -- Aggressive cost efficiencies -- Pursue incentive opportunities * Related Diversification -- Leverage existing asset base into knowledge-based businesses with high returns -- Integrating existing businesses into growth markets * Creating New Business Opportunities in Growth Markets -- Asset optionality -- Distributed generation * Maintain strong financial profile: Solid investment grade ratings ...CREATES A COMPELLING VALUATION OPPORTUNITY 9 ====================================================================== [Graph depicting the following data:]
El Paso Gas Diversified KeySpan Dominion Energy Distribution(2) Energy Resources Electrics(3) NiSource ------- --------------- ------- --------- ------------ -------- 2001E P/E(1) 18.7x 15.2x 15.2x 14.1x 13.4x 12.7x EPS Growth Rate(1) 15.0 10.0 8.0 8.8 6.6 10.0+ (1) I/B/E/S Consensus 2001 P/E and I/B/E/S Consensus LTG rate, as of October 6, 2000 (2) Questar, Equitable Resources, National Fuel Gas, Keyspan Energy (3) Philadelphia Electric Utility Index
* * * * * These slides contain certain forward-looking statements within the meaning of the federal securities laws; these forward-looking statements are subject to various risks and uncertainties. The factors that could cause actual results to differ materially from the projections, forecasts, estimates and expectations discussed herein may include factors that are beyond the companies' ability to control or estimate precisely, such as estimates of future market conditions, the behavior of other market participants and the actions of the Federal and State regulators. Other factors include, but are not limited to, actions in the financial markets, weather conditions, economic conditions in the two companies' service territories, fluctuations in energy-related commodity prices, conversion activity, other marketing efforts and other uncertainties. Other risk factors are detailed from time to time in the two companies' SEC reports. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of these slides. The companies do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of these stories. In addition to other documents filed with the Securities and Exchange Commission by the two companies, NiSource and the new holding company have filed a registration statement, which contains a joint proxy statement/prospectus for NiSource Inc. and Columbia Energy Group. The final joint proxy statement/prospectus, dated April 24, 2000, is available and has been distributed to the companies' shareholders. Investors and security holders are urged to read the joint proxy statement/prospectus and any other relevant documents filed with the SEC when they become available because they will contain important information. Investors and security holders can receive the joint proxy statement/prospectus and other documents free of charge at the SEC's web site, www.sec.gov, from NiSource Investor Relations at 801 East 86th Avenue, Merrillville, Indiana 46410 or at its web site, www.nisource.com, or from Columbia Investor Relations at 13880 Dulles Corner Lane, Herndon, Virginia 20171 or at its web site, www.columbiaenergygroup.com. -----END PRIVACY-ENHANCED MESSAGE-----