SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549






                                    FORM 8-K
                                 CURRENT REPORT






     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934






      DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) - DECEMBER 30, 1999







                              MINNESOTA POWER, INC.


                             A Minnesota Corporation
                           Commission File No. 1-3548
                   IRS Employer Identification No. 41-0418150
                             30 West Superior Street
                          Duluth, Minnesota 55802-2093
                           Telephone - (218) 722-2641







ITEM 5.  OTHER EVENTS.

Reference is made to the Annual Report on Form 10-K for the year ended  December
31, 1998 (1998 Form 10-K) of Minnesota Power, Inc.  (Minnesota Power or Company)
for background  information on the following  update.  The cited reference is to
the Company's 1998 Form 10-K.


Ref. Page 22. - Fifth and Six Paragraphs
Ref. Form 8-K dated and filed May 27, 1999
Ref. Form 8-K dated and filed June 15, 1999
Ref. 10-Q for the quarter ended June 30, 1999 Page 11. - Fifth through Seventh
Paragraphs
Ref. 10-Q for the quarter ended September 30, 1999 Page 21. - Third through
Fifth Paragraphs

On December 30, 1999 the  shareholders  of Capital Re  Corporation  (Capital Re)
approved  the merger of Capital Re with ACE  Limited  (ACE) and the  transaction
closed. Each Capital Re share was exchanged for 0.65 ordinary shares of ACE plus
$3.4456 in cash which delivered an approximate  value of $14 for each Capital Re
share.

In exchange for its 7.3 million shares of Capital Re,  Minnesota  Power received
4.7  million  ordinary  shares of ACE and $25.1  million  in cash.  Based on the
December  29,  1999  $16.75  closing  price of ACE,  the total value of proceeds
received was $104.4  million.  Minnesota  Power will record an additional  $12.1
million  non-cash  charge to net income  during  the  fourth  quarter of 1999 to
reflect the final valuation of this  transaction.  This charge combined with the
$24.1 million  non-cash charge recorded in June 1999 will result in a total 1999
charge of $36.2 million to Minnesota  Power's net income.  Minnesota Power owned
20 percent of Capital Re before the merger, and now owns 2 percent of ACE.

Capital Re is a financial guaranty  reinsurance and specialty insurance company.
ACE  through  its  subsidiaries,   provides  a  broad  range  of  insurance  and
reinsurance products for a diverse group of international clients. ACE trades on
the New York Stock Exchange under the symbol ACL.


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                                   SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.





                                                      Minnesota Power, Inc.
                                               ---------------------------------
                                                         (Registrant)





December 30, 1999                                       D. G. Gartzke
                                               ---------------------------------
                                                        D. G. Gartzke
                                                Senior Vice President - Finance
                                                  and Chief Financial Officer

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