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FPL Cites Entergy Forecasts for End to Merger

April 03, 2001|Reuters

FPL Group Inc. said differences between projections supplied to it and to investment bankers by Entergy Corp. led to the two companies calling off their proposed $7.6-billion merger. FPL Chief Executive James Broadhead said FPL, one of the largest providers of electricity-related services in the U.S., lost confidence in Entergy's management because of the different forecasts. Broadhead said FPL's confidence was "destroyed" by Entergy's unwillingness to discuss the differences. Forecasts presented to FPL as part of the merger talks were "significantly" lower than projections made to Entergy's board and investment bankers, he told analysts. The merger agreement reached in late July 2000 would have created the largest U.S. power distributor, serving about 6.3 million customers in the South. Entergy is a major global energy company engaged in power production, distribution and related services. In a separate statement, Entergy said it was still confident in its financial plan and cited a number of management-related and financial reasons for the failure of the merger.

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