News Releases

Sierra Pacific Receives Notice: Washington Water Power Pulls Out of Merger

Jun 28, 1996

Sierra Pacific Resources
Contact: Media contact: Faye I. Andersen; Analyst/broker contact: Malyn Malquist
Phone: Andersen: (775)834-4822; Malquist: (775)834-5400

For Immediate Release

(Reno) -- Sierra Pacific Resources (NYSE: SRP) officials Friday acknowledged receipt of notification from their merger partner, Spokane-based Washington Water Power Co. (WWP), that WWP no longer intends to pursue the merger of the two companies. Sierra Pacific and WWP announced their plans to merge on June 28, 1994. Since that time, the companies had gained approval from regulators in six states and this week concluded hearings before the Federal Energy Regulatory Commission's (FERC) administrative law judge in Washington, D.C.

"We regret that WWP chose to terminate the agreement to merge," said Walter Higgins, chairman, president and CEO of Sierra Pacific Resources."Sierra Pacific believes the merger was in the best interest of our customers, shareholders and communities.

"Even though this is not the conclusion we'd hoped and worked for, we're deeply appreciative of the tremendous efforts of Sierra Pacific employees, who've worked these past two years to make the merger a reality and continue to serve our customers well," Higgins said."Their courage and ability to work effectively through this difficult process is a real tribute to their dedication."

Higgins went on to thank both the Public Service Commission of Nevada and the California Public Utilities Commission who worked very hard to deliberate and render state rulings in favor of the merger.

"We also appreciate the continuing support from our customers and the communities in which we serve while Sierra worked to prepare itself for the changes that deregulation is bringing to the utility industry," he said.

Nationwide changes are taking place as state and federal legislators and regulators break down barriers to competition which exist in the electric industry.

Higgins noted that the merger preparation work has helped make Sierra Pacific a stronger and healthier company."During these past two years, we have learned a great deal to prepare us for the challenges of competition in the energy services business," he said."It's helped us become focused to do a better job for our customers, our shareholders and our communities."

Sierra's board expressed confidence in the company's future."Sierra has achieved record levels of customer satisfaction and shareholder earnings while freezing customer prices the past two years."

According to Higgins,"Everyone who is interested in our company -- customers, shareholders, employees, communities and regulators -- can be assured that we will take the right strategic actions to continue to provide top quality service to our customers at the lowest possible price."