-----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, Wk0O7zTjfp7ufD+YTCX6Y96y/RE7hi8SZudkPkBXFShRZo5djZfmBx37TuURsNel OP247BtFqAm493LdqhaJzg== 0000950124-07-002652.txt : 20070503 0000950124-07-002652.hdr.sgml : 20070503 20070503100606 ACCESSION NUMBER: 0000950124-07-002652 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070502 ITEM INFORMATION: Completion of Acquisition or Disposition of Assets ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070503 DATE AS OF CHANGE: 20070503 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONSUMERS ENERGY CO CENTRAL INDEX KEY: 0000201533 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 380442310 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05611 FILM NUMBER: 07813241 BUSINESS ADDRESS: STREET 1: ONE ENERGY PLAZA CITY: JACKSON STATE: MI ZIP: 49201 BUSINESS PHONE: 5177881031 MAIL ADDRESS: STREET 1: ONE ENERGY PLAZA CITY: JACKSON STATE: MI ZIP: 49201 FORMER COMPANY: FORMER CONFORMED NAME: CONSUMERS POWER CO DATE OF NAME CHANGE: 19920703 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CMS ENERGY CORP CENTRAL INDEX KEY: 0000811156 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 382726431 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09513 FILM NUMBER: 07813240 BUSINESS ADDRESS: STREET 1: ONE ENERGY PLAZA CITY: JACKSON STATE: MI ZIP: 49201 BUSINESS PHONE: 5177881031 MAIL ADDRESS: STREET 1: ONE ENERGY PLAZA CITY: JACKSON STATE: MI ZIP: 49201 8-K 1 k14845e8vk.txt CURRENT REPORT DATED MAY 2, 2007 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 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) MAY 2, 2007
COMMISSION REGISTRANT; STATE OF INCORPORATION; IRS EMPLOYER FILE NUMBER ADDRESS; AND TELEPHONE NUMBER IDENTIFICATION NO. - ----------- ---------------------------------- ------------------- 1-9513 CMS ENERGY CORPORATION 38-2726431 (A MICHIGAN CORPORATION) ONE ENERGY PLAZA JACKSON, MICHIGAN 49201 (517) 788-0550 1-5611 CONSUMERS ENERGY COMPANY 38-0442310 (A MICHIGAN CORPORATION) ONE ENERGY PLAZA JACKSON, MICHIGAN 49201 (517) 788-0550
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.01. COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS. On May 2, 2007, CMS Enterprises Company, a wholly owned subsidiary of CMS Energy Corporation ("CMS Energy"), completed the previously announced sale of CMS Generation, its wholly owned subsidiary. CMS Generation holds an indirect interest in certain independent power and water projects and plant operations and maintenance companies located in Morocco, Saudi Arabia, Ghana, India and the United Arab Emirates. The Abu Dhabi National Energy Company PJSC ("Abu Dhabi") was the buyer. The purchase price was $900 million, which included the payment of approximately $106 million in debt. A CMS Energy-issued news release dated May 2, 2007, which is attached as Exhibit 99.1 and incorporated by reference, contains additional information with respect to the transaction. CMS Energy and Abu Dhabi's majority owner, the Abu Dhabi Water and Electricity Authority ("ADWEA"), have been long-time partners. In conjunction with ADWEA (in the case of one project, in conjunction with International Power Plc), CMS Generation developed, constructed, and operated two major independent power and water projects in the United Arab Emirates. Those facilities, Al Taweelah A2 and Shuweihat S1, were part of the sale. The other businesses included in the sale were CMS Energy's interests in the Jorf Lasfar Energy Company coal-fueled power plant in Morocco, the Jubail Energy Company natural gas cogeneration power plant in Saudi Arabia, the Takoradi International Company crude oil power plant in Ghana, and the ST-CMS Company coal-fueled power plant in Neyveli, India. A significant portion of CMS Generation's interests are equity method investments. The sale agreements contain indemnifications, guarantees, and representations and warranties that are typical for such sale transactions. Consideration for the sale was established as a result of (1) the use of CMS Energy's internal valuation models, (2) assistance by investment banking consultants, and (3) arm's-length negotiations between CMS Energy and Abu Dhabi. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. (b) PRO FORMA FINANCIAL INFORMATION The accompanying unaudited pro forma condensed consolidated financial statements reflect adjustments to the historical consolidated financial statements of CMS Energy to give effect to the sale of interests in CMS Generation and the sale of Argentine and Michigan businesses discussed in the Form 8-K filed on March 14, 2007. The transactions will be accounted for in accordance with Statement of Financial Accounting Standards (FAS) No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" and Emerging Issues Task Force 03-13, "Applying the Conditions in Paragraph 42 of FAS Statement No. 144 in Determining Whether to Report Discontinued Operations". Certain information and notes normally included in consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission governing pro forma information. The accompanying unaudited pro forma condensed consolidated financial statements should be read in conjunction with the consolidated financial statements of CMS Energy, as contained in its 2006 Annual Report on Form 10-K. The Unaudited Pro Forma Condensed Consolidated Balance Sheet assumes the sale of interests in CMS Generation and the sale of Argentine and Michigan businesses were completed on December 31, 2006. Therefore, the net loss and gain on the sales recognized at December 31, 2006 in the Unaudited Pro Forma Condensed Consolidated Balance Sheet will ultimately differ from the actual loss and gain that occurred at the dates of sale. The Unaudited Pro Forma Condensed Consolidated Statements of Income (Loss) assume the dispositions occurred on January 1, 2004. The accompanying unaudited pro forma condensed consolidated financial statements are presented for purposes of illustration only, in accordance 2 with the adjustments set forth below, and are not necessarily indicative of the financial position or results of operations that would have occurred had the sales been completed on the dates as of which, or at the beginning of the period which, the sales are being given effect, nor are they necessarily indicative of future operating results or financial position of CMS Energy. 3 CMS ENERGY CORPORATION UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2006 (In Millions)
ARGENTINE AND MICHIGAN HISTORICAL CMS GENERATION ADJUSTMENTS HISTORICAL AND SALE ADJUSTMENTS TRANSACTION AND SALE PRO FORMA HISTORICAL (NOTES 1 AND TRANSACTION ADJUSTMENTS PRO FORMA CMS ENERGY 2) (NOTES 1 AND 2) (NOTES 1 AND 2) CMS ENERGY ---------- ------------ --------------- --------------- ---------- ASSETS Plant and property (at cost) $ 12,642 $ (250) $ (54) $ - $ 12,338 Less accumulated depreciation, depletion and amortization 5,317 (119) (11) - 5,187 --------------- -------------- ---------------- ---------------- ------------- 7,325 (131) (43) 7,151 Construction work-in-progress 651 - - - 651 --------------- -------------- ---------------- ---------------- ------------- Net plant and property 7,976 (131) (a) (43) (a) - 7,802 Investments 598 (19) (a) (477) (a) - 102 Cash and cash equivalents at cost, which approximates market 351 130 (a) 771 (a) (959) (b) 293 Accounts receivable, notes receivable, and accrued revenue, net 808 (25) (a) (36) (a) - 747 Inventories at average cost 1,357 (6) (a) (3) (a) - 1,348 Other current assets 627 (2) (a) (67) (a) - 558 Non-current assets 3,654 (16) (a) (106) (a) - 3,532 --------------- -------------- ---------------- ---------------- ------------- TOTAL ASSETS $ 15,371 $(69) $ 39 $ (959) $ 14,382 =============== ============== ================ ================ ============= STOCKHOLDERS' INVESTMENT AND LIABILITIES Common stockholders' equity $ 2 $ - $ - $ - $ 2 Other paid-in capital 4,468 - - - 4,468 Accumulated other comprehensive loss (318) 127 (c) (14) (c) - (205) Retained deficit (1,918) (161) (d) 33 (d) - (2,046) Preferred stock 305 - - - 305 Long-term debt 6,202 - (106) (e) (959) (b) 5,137 Long-term debt related parties 178 - - - 178 Non-current portion of capital and finance lease obligations 42 - - - 42 --------------- -------------- ---------------- ---------------- ------------- Total capitalization 8,961 (34) (87) (959) 7,881 Minority interests 91 (3) (f) (11) (f) - 77 Accounts payable 564 (21) (g) (16) (g) - 527 Other current liabilities 1,592 (13) (g) (20) (g) - 1,559 Non-current liabilities 4,163 2 (g) 173 (g) - 4,338 --------------- -------------- ---------------- ---------------- ------------- TOTAL STOCKHOLDERS' INVESTMENT AND LIABILITIES $ 15,371 $ (69) $ 39 $ (959) $ 14,382 =============== ============== ================ ================ =============
See notes to pro forma condensed consolidated financial statements. 4 CMS ENERGY CORPORATION UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) FOR THE YEAR ENDED DECEMBER 31, 2006 (In Millions, except per share amounts)
ARGENTINE AND MICHIGAN HISTORICAL CMS GENERATION PRO FORMA ADJUSTMENTS HISTORICAL ADJUSTMENTS HISTORICAL (NOTES 1 AND ADJUSTMENTS (NOTES 1 PRO FORMA CMS ENERGY 2) (NOTES 1 AND 2) AND 2) CMS ENERGY ---------- ------------ --------------- ------ ---------- OPERATING REVENUE $ 6,810 $ (199) (h) $ (254) (h) $ - $ 6,357 EARNINGS FROM EQUITY METHOD INVESTEES 89 (3) (i) (89) (i) - (3) OPERATING EXPENSES - Fuel for electric generation 984 (59) (j) (202) (j) - 723 Fuel costs mark-to-market at the MCV Partnership 204 - - - 204 Purchased and interchange power 829 (50) (j) - - 779 Cost of gas sold 2,131 - - - 2,131 Other operating expense 1,225 (18) (j) (20) (j) - 1,187 Maintenance 326 (15) (j) (8) (j) - 303 Depreciation, depletion, and amortization 576 (13) (j) (12) (j) - 551 General taxes 198 (1) (j) (3) (j) - 194 Asset impairment charges 459 - - - 459 ------------ --------------- ---------------- ------------ ------------ 6,932 (156) (245) - 6,531 ------------ --------------- ---------------- ------------ ------------ OPERATING LOSS (33) (46) (98) - (177) OTHER INCOME (DEDUCTIONS) - Gain on asset sales, net 79 - - - 79 Interest and dividends 86 (5) (k) - - 81 Other income 36 - (3) (k) - 33 ------------ --------------- ---------------- ------------ ------------ 201 (5) (3) - 193 FIXED CHARGES 511 (10) (l) (12) (l) (67) (m) 422 ------------ --------------- ---------------- ------------ ------------ INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTERESTS (OBLIGATIONS) (343) (41) (89) 67 (406) MINORITY INTEREST (OBLIGATIONS), NET (100) (1) (n) (1) (n) - (102) INCOME TAX EXPENSE (BENEFIT) (158) (19) (o) (7) (o) 23 (p) (161) ------------ --------------- ---------------- ------------ ------------ INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PREFERRED DIVIDENDS (85) (21) (81) 44 (143) PREFERRED DIVIDENDS 11 - - - 11 ------------ --------------- ---------------- ------------ ------------ INCOME (LOSS) FROM CONTINUING OPERATIONS AFTER PREFERRED DIVIDENDS $ (96) $ (21) $ (81) $ 44 $ (154) ============ =============== ================ ============ ============ INCOME (LOSS) FROM CONTINUING OPERATIONS PER SHARE: Basic - Average Common Shares Outstanding 219.9 219.9 - Income (Loss) Per Average Common Share $(0.44) $(0.70) Diluted - Average Common Shares Outstanding 219.9 219.9 - Income (Loss) Per Average Common Share $(0.44) $(0.70)
See notes to pro forma condensed consolidated financial statements. 5 CMS ENERGY CORPORATION UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) FOR THE YEAR ENDED DECEMBER 31, 2005 (In Millions, except per share amounts)
ARGENTINE AND MICHIGAN HISTORICAL CMS GENERATION PRO FORMA ADJUSTMENTS HISTORICAL ADJUSTMENTS HISTORICAL (NOTES 1 AND ADJUSTMENTS (NOTES 1 PRO FORMA CMS ENERGY 2) (NOTES 1 AND 2) AND 2) CMS ENERGY ---------- ---------- --------------- ------ ---------- OPERATING REVENUE $ 6,288 $ (142) (h) $ (87) (h) $ - $ 6,059 EARNINGS FROM EQUITY METHOD INVESTEES 125 (4) (i) (100) (i) - 21 OPERATING EXPENSES - Fuel for electric generation 720 (40) (j) (36) (j) - 644 Fuel costs mark-to-market at the MCV Partnership (200) - - - (200) Purchased and interchange power 546 (38) (j) 1 (j) - 509 Cost of gas sold 2,297 - - - 2,297 Other operating expense 1,105 (13) (j) (22) (j) - 1,070 Maintenance 249 (10) (j) (3) (j) - 236 Depreciation, depletion, and amortization 525 (11) (j) (9) (j) - 505 General taxes 261 (1) (j) (1) (j) - 259 Asset impairment charges 1,184 - - - 1,184 ------------ --------------- ---------------- ------------ ----------- 6,687 (113) (70) - 6,504 ------------ --------------- ---------------- ------------ ----------- OPERATING LOSS (274) (33) (117) - (424) OTHER INCOME (DEDUCTIONS) - Gain on asset sales, net 6 - - - 6 Interest and dividends 66 (2) (k) (1) (k) - 63 Other income (15) - 3 (k) - (12) ------------ --------------- ---------------- ------------ ----------- 57 (2) 2 - 57 FIXED CHARGES 489 (8) (l) 1 (l) (67) (m) 415 ------------ --------------- ---------------- ------------ ----------- INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTERESTS (OBLIGATIONS) (706) (27) (116) 67 (782) MINORITY INTEREST (OBLIGATIONS), NET (440) (1) (n) (2) (n) - (443) INCOME TAX EXPENSE (BENEFIT) (168) (16) (o) 48 (o) 23 (p) (113) ------------ --------------- ---------------- ------------ ----------- INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PREFERRED DIVIDENDS (98) (10) (162) 44 (226) PREFERRED DIVIDENDS 10 - - - 10 ------------ --------------- ---------------- ------------ ----------- INCOME (LOSS) FROM CONTINUING OPERATIONS AFTER PREFERRED DIVIDENDS $ (108) $ (10) $ (162) $ 44 $ (236) ============ =============== ================ ============ =========== INCOME (LOSS) FROM CONTINUING OPERATIONS PER SHARE: Basic - Average Common Shares Outstanding 211.8 211.8 - Income (Loss) Per Average Common Share $(0.51) $(1.11) Diluted - Average Common Shares Outstanding 211.8 211.8 - Income (Loss) Per Average Common Share $(0.51) $(1.11)
See notes to pro forma condensed consolidated financial statements. 6 CMS ENERGY CORPORATION UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) FOR THE YEAR ENDED DECEMBER 31, 2004 (In Millions, except per share amounts)
ARGENTINE AND MICHIGAN HISTORICAL CMS GENERATION PRO FORMA ADJUSTMENTS HISTORICAL ADJUSTMENTS HISTORICAL (NOTES 1 AND ADJUSTMENTS (NOTES 1 PRO FORMA CMS ENERGY 2) (NOTES 1 AND 2) AND 2) CMS ENERGY ---------- ------------- --------------- ------ ---------- OPERATING REVENUE $ 5,472 $ (103) (h) $ (65) (h) $ - $ 5,304 EARNINGS FROM EQUITY METHOD INVESTEES 115 (1) (i) (88) (i) - 26 OPERATING EXPENSES - Fuel for electric generation 774 (29) (j) (16) (j) - 729 Fuel costs mark-to-market at the MCV Partnership 19 - - - 19 Purchased and interchange power 344 (17) (j) - - 327 Cost of gas sold 1,786 - - - 1,786 Other operating expense 954 (10) (j) (17) (j) - 927 Maintenance 256 (10) (j) (3) (j) - 243 Depreciation, depletion, and amortization 431 (12) (j) (2) (j) - 417 General taxes 270 (1) (j) - - 269 Asset impairment charges 160 - - - 160 ------------ --------------- ---------------- ------------ ---------- 4,994 (79) (38) - 4,877 ------------ --------------- ---------------- ------------ ---------- OPERATING INCOME (LOSS) 593 (25) (115) - 453 OTHER INCOME (DEDUCTIONS) - Gain on asset sales, net 52 - - - 52 Interest and dividends 27 - (1) (k) - 26 Other income 99 (2) (k) (1) (k) - 96 ------------ --------------- ---------------- ------------ ---------- 178 (2) (2) - 174 FIXED CHARGES 634 (11) (l) (12) (l) (67) (m) 544 ------------ --------------- ---------------- ------------ ---------- INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTERESTS (OBLIGATIONS) 137 (16) (105) 67 83 MINORITY INTEREST (OBLIGATIONS), NET 15 (1) (n) (2) (n) - 12 INCOME TAX EXPENSE (BENEFIT) (5) (6) (o) (11) (o) 23 (p) 1 ------------ --------------- ---------------- ------------ ---------- INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PREFERRED DIVIDENDS 127 (9) (92) 44 70 PREFERRED DIVIDENDS 11 - - - 11 ------------ --------------- ---------------- ------------ ---------- INCOME (LOSS) FROM CONTINUING OPERATIONS AFTER PREFERRED DIVIDENDS $ 116 $ (9) $ (92) $ 44 $ 59 ============ =============== ================ ============ ========== INCOME (LOSS) FROM CONTINUING OPERATIONS PER SHARE: Basic - Average Common Shares Outstanding 168.6 168.6 - Income (Loss) Per Average Common Share $0.68 $0.35 Diluted - Average Common Shares Outstanding 172.1 172.1 - Income (Loss) Per Average Common Share $0.67 $0.35
See notes to pro forma condensed consolidated financial statements. 7 NOTE 1 -- SALE OF INTERESTS IN THE ARGENTINE AND MICHIGAN BUSINESSES AND CMS GENERATION CMS Energy has reflected, in the accompanying unaudited pro forma condensed consolidated financial statements, total proceeds of $1.080 billion. The proceeds from the sales will be used to reduce debt. The sales would result in an after-tax loss of $128 million if calculated as of December 31, 2006. This loss is reflected in retained deficit in the accompanying Unaudited Pro Forma Condensed Consolidated Balance Sheet as of December 31, 2006. The loss was calculated as follows:
In Millions ---------------------------------------------------------------- Michigan and Argentine CMS Businesses Generation Total ----------------- -------------- ------------------- Total proceeds $ 180 $ 900 $ 1,080 Net book value of assets sold (202) (686) (a) (888) Reclassification of cumulative foreign currency translation adjustments (195) 3 (192) Reclassification of derivatives in other comprehensive loss - 22 22 Fair value liabilities (25) (b) (80) (c) (105) Selling expenses (5) (10) (15) ----------------- -------------- ------------------- Gain (Loss) on Sale Before Taxes (247) 149 (98) Tax benefit (expense) 86 (116) (d) (30) ----------------- -------------- ------------------- Net Gain (Loss) on Sale $ (161) $ 33 $ (128) ================= ============== ===================
(a) Includes payment of $106 million of debt by Abu Dhabi. (b) Relates to the recognition of an estimated $25 million fair value of a liability related to claims on Gas Transmission and Generation assets in Argentina. (c) Relates to the recognition of the estimated fair value of liabilities related to indemnities at certain CMS Generation interests. (d) Includes $64 million of U.S. income tax expense associated with the change in determination of permanent reinvestment of undistributed earnings. The Unaudited Pro Forma Condensed Consolidated Statements of Income (Loss) for the years ended December 31, 2005 and December 31, 2004 present the elimination of historical values that will not qualify for discontinued operations and historical values to be reclassified as discontinued operations that were not required to be reflected in discontinued operations as of December 31, 2006. The Unaudited Pro Forma Condensed Consolidated Statements of Income (Loss) include the elimination of allocated parent interest of $15 million in 2006, $11 million in 2005, and $14 million in 2004. The after-tax loss resulting from this transaction has not been reflected in the accompanying Unaudited Pro Forma Condensed Consolidated Statements of Income (Loss). 8 NOTE 2 --ADJUSTMENTS The following is a summary of the adjustments: Condensed Consolidated Balance Sheet: (a) To reflect the removal of the interests in the transferred assets and the receipt of cash consideration from the Argentine and Michigan Businesses and CMS Generation. (b) To reflect the use of the net proceeds of $959 million to retire long-term debt, excluding any premiums assessed to retire long-term debt. The net proceeds are calculated as follows:
In Millions ----------- Total proceeds $1,080 Less: Payment of debt by Abu Dhabi (106) Selling expenses (15) ------ $ 959 ------
(c) To reflect the reversal of $125 million, net of $ 67 million in taxes, of certain cumulative amounts of the Argentine Businesses and CMS Generation-related foreign currency translation adjustments from Accumulated other comprehensive loss into earnings offset by the reversal of $12 million, into earnings, net of $10 million in taxes, of certain cumulative amounts of the CMS Generation-related derivative fair value changes that are accounted for in Accumulated other comprehensive loss. (d) To reflect the earnings impact, net of tax, of the loss on the sale of CMS Energy's interests in the Argentine and Michigan Businesses and the gain on the sale of CMS Energy's interests in CMS Generation and the reclassification of cumulative foreign currency translation adjustments and certain derivative fair value changes. (e) To reflect the retirement of long-term debt at CMS Generation. (f) To reflect the removal of Minority interests. (g) To reflect the removal of the interests in the transferred liabilities, the recognition of the estimated fair value of non-current liabilities related to indemnities at certain CMS Generation interests, and the recognition of non-current deferred tax liabilities in conjunction with the sale of CMS Energy's interests. Condensed Consolidated Statements of Income (Loss): (h) To reflect the elimination of historical Operating Revenue, assuming the dispositions occurred as of January 1, 2004. (i) To reflect the elimination of historical Earnings from Equity Method Investees for the Argentine Businesses and CMS Generation, assuming the dispositions occurred as of January 1, 2004. Equity method earnings do not include Takoradi and other consolidated entities. (j) To reflect the elimination of historical Operating Expenses, assuming the dispositions occurred as of January 1, 2004. (k) To reflect the elimination of historical Other Income (Deductions), assuming the dispositions occurred as of January 1, 2004. (l) To reflect the elimination of historical Fixed Charges and allocated parent interest, assuming the dispositions occurred as of January 1, 2004. (m) To reflect reduced interest expense at an average interest rate of 7.0 percent from the use of $959 million of net proceeds to reduce long-term debt outstanding assuming the dispositions occurred as of January 1, 2004. 9 (n) To reflect the elimination of Minority Interest (Obligations), assuming the dispositions occurred as of January 1, 2004. (o) To reflect the elimination of income tax expense applicable to CMS Energy's interests, assuming the dispositions occurred as of January 1, 2004. (p) To reflect the income tax effects of the pro forma adjustments, assuming the dispositions occurred as of January 1, 2004. (d) EXHIBITS. 99.1 CMS Energy's News Release dated May 2, 2007. This Form 8-K contains "forward-looking statements" as defined in Rule 3b-6 of the Securities Exchange Act of 1934, as amended, Rule 175 of the Securities Act of 1933, as amended, and relevant legal decisions. The forward-looking statements are subject to risks and uncertainties. They should be read in conjunction with "FORWARD-LOOKING STATEMENTS AND INFORMATION" and "RISK FACTORS" each found in the MANAGEMENT'S DISCUSSION AND ANALYSIS sections of CMS Energy's Form 10-K and Consumers' Form 10-K for the Year Ended December 31, 2006 (CMS Energy's and Consumers' "FORWARD-LOOKING STATEMENTS AND INFORMATION" and "RISK FACTORS" sections are incorporated herein by reference), that discuss important factors that could cause CMS Energy's and Consumers' results to differ materially from those anticipated in such statements. 10 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 hereunto duly authorized. CMS ENERGY CORPORATION Dated: May 3, 2007 By: /s/ Thomas J. Webb ----------------------------------- Thomas J. Webb Executive Vice President and Chief Financial Officer CONSUMERS ENERGY COMPANY Dated: May 3, 2007 By: /s/ Thomas J. Webb ----------------------------------- Thomas J. Webb Executive Vice President and Chief Financial Officer 11 EX-99.1 2 k14845exv99w1.txt NEWS RELEASE DATED MAY 2, 2007 Exhibit 99.1 (CMS ENERGY LOGO) News Release CMS ENERGY COMPLETES SALE OF BUSINESS INTERESTS IN THE MIDDLE EAST, AFRICA, AND INDIA JACKSON, Mich., May 2, 2007 -- CMS Energy completed today the sale of its ownership interests in businesses in the Middle East, Africa, and India to the Abu Dhabi National Energy Company (TAQA) for $900 million. Proceeds from the sale of the company's CMS Generation subsidiary will be used to retire part of CMS Energy's parent company debt and for general corporate purposes, primarily investments in its Michigan utility, Consumers Energy. CMS Generation and TAQA's majority owner, the Abu Dhabi Water and Electricity Authority (ADWEA), are long-time partners. CMS Generation, in conjunction with ADWEA, developed, constructed, and operates the Al Taweelah A2 facility and in conjunction with ADWEA and International Power developed, constructed, and operates the Shuweihat S1 facility. The two major power and desalination projects are in the United Arab Emirates. The CMS Generation portfolio also includes ownership interests in generation businesses in Morocco, Saudi Arabia, Ghana, and India. CMS Energy (NYSE: CMS) is a Michigan-based company that has as its primary business operations an electric and natural gas utility, natural gas pipeline systems, and independent power generation. # # # For more information on CMS Energy, please visit our web site at: www.cmsenergy.com Media Contacts: Jeff Holyfield, 517/788-2394 or Dan Bishop, 517/788-2395 Investment Analyst Contact: CMS Energy Investor Relations, 517/788-2590 -----END PRIVACY-ENHANCED MESSAGE-----