New York Rejects Entergy’s Spinoff of Nuclear Plants (Update1)

[bananas]

Source: Business Week (Bloomberg)

Entergy Corp.’s plan to raise at least $3 billion by spinning off six nuclear reactors into a separate company was rejected by the New York Public Service Commission.

The commission voted unanimously today at a regular meeting in New York City, after its staff and state Attorney General Andrew Cuomo argued the transaction would hurt the public by creating a “debt-laden” company with fewer financial resources to meet obligations to dismantle the plants.
...
Enexus “would not be a financially viable entity in the long term” because of the debt loads proposed by Entergy, John Stewart, the regulator’s director of utility rates and service, said at the meeting.
...
Entergy’s debt is rated BBB, the second-lowest investment grade, by Standard & Poor’s and Baa3, the lowest investment grade, by Moody’s Investors Service.
...

Read more: http://www.businessweek.com/news/2010-03-26/new-york-rejects-entergy-s-spinoff-of-nuclear-plants-update3-.html

[Demeter]

1. Keep Your Toxic Waste

and let's not go down this rathole again

[cosmicone]

2. PG&E did the same in California.

Sold all assets and paid the money to its stockholders. Then declared bankruptcy when the energy producing asset holders raised the charges. PG&E should have been stopped from robbing California consumers out of >$100 Billion

[dixiegrrrrl]

3. Cuomo is very smart.

Companies can and do form subsidiaries, load them with debt while the income stream is sent to the parent company, then declare bankruptcy for the debt laden subsidiary. Investors, pensioners, lose all their money.
A widely used tactic in Argentina, which contributed to the collapse of that country a few years back.
A hated tactic during the Energy crisis in Ca. a few years back.
And recently used by GMC, to the shock of the investors of the "old" company who lost everything.

[bananas]

4. Exactly. nt