Allegheny Energy says 98.3% of trust preferreds converted in tender offer

New York, April 21 - Allegheny Energy, Inc. said holders of $295.0 million or 98.3% of Allegheny Capital Trust I's $300 million of 11 7/8% mandatorily convertible trust preferred securities due 2008 accepted its early conversion offer.

"This successful transaction is another significant step in strengthening Allegheny Energy's financial condition," said Paul J. Evanson, chairman, president and chief executive officer of Allegheny Energy, in a news release. "It brings us one step closer to achieving a 30% equity ratio and improves our credit profile."

The Greensburg, Pa., electric utility announced the tender offer and consent solicitation to encourage conversion of the securities on March 23. It was offering 83.33 shares of its common stock and $160.00 in cash per $1,000 liquidation amount to holders that agree to convert and consent to amend the indenture of the underlying 11 7/8% notes.

The trust preferreds have a conversion price of $12.00. Allegheny stock closed at $22.72 on Thursday.

The tender expired at midnight ET on April 20.

The information agent is Global Bondholder Services Corp. (212 430-3774 or 866 795-2200).

Allegheny issued the trust preferreds in July 2003 in a private placement.

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