TECO Energy considers sale of transport business, continues to reduce debt

By Lisa Kerner

Charlotte, N.C., Feb. 6 - TECO Energy, Inc. is considering a sale of TECO Transport as the company continues to pare down parent debt, according to remarks made by chief financial officer Gordon Gillette during the company's fourth-quarter earnings call on Tuesday.

"Our stated cash priorities have been to retire TECO Energy parent-level debt and invest in our utilities operations as needed," Gillette said.

Last April, the company committed to retiring $500 million of parent debt in the 2008-2010 period in addition to the $357 million of debt reduction planned for 2007.

"In order to serve dual goals of retiring debt and investing in Tampa Electric Co., we are exploring long-term options of TECO Transport, including the sale of this business," Gillette said.

The decision to sell is not being taken lightly, given the transport business' performance history. However, according to Gillette, "a transaction could lead to an outcome that is good for all constituents."

Proceeds from the sale of TECO Transport would be used to retire parent company debt as well as free up money for Tampa Electric, Gillette added.

TECO is an integrated energy-related holding company based in Tampa, Fla.

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