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Cities renew request for NorthWestern buyout discussions

Cities renew request for NorthWestern buyout discussions

HELENA — The group of Montana cities rebuffed in attempts to buy NorthWestern Energy's utilities are again asking the company to engage in negotiations.

Montana Public Power Inc. sent a letter Tuesday to NorthWestern saying it needs to be included on the short list of options the company is considering.

Large shareholders are pressuring NorthWestern to look at buyout or merger options, but those shareholders are increasingly touting a deal offered by South Dakota utility Black Hills Corp.

Last week, large shareholders accused company executives of dismissing buyout offers in order to protect their own jobs.

NorthWestern has said it has already looked at the MPPI offer and twice rejected it, in part because the deal was deemed risky and unlikely to close.

Company spokeswoman Claudia Rapkoch said Tuesday she had not seen the latest letter.

The consortium of cities says it wants to set up a public utility in Montana that is under local control.

"Any evaluation of strategic alternatives would be incomplete without a thorough investigation of our offer, and we look forward to conducting due diligence so that we can put our best offer forward on the basis of all available information," Mike Kadas of MPPI wrote NorthWestern chief executive Mike Hanson on Tuesday.

Kadas said the public power group is willing to sign a confidentiality agreement and offer the company other safeguards during negotiations.

"We continue to believe that our offer is compelling and provides substantial value and liquidity to NorthWestern's shareholders," Kadas wrote.

NorthWestern, which bought utility assets from the now-defunct Montana Power Co., recently came out of bankruptcy and is facing increasing pressure to look at merger options.

"The risk to consumers cannot be overstated," Kadas wrote. "We are steadfast in our belief that without local control, there is no guarantee that NorthWestern's future is not a repeat of its recent past."

Kadas also criticized the company for reports that it offered a lucrative buyout to the shareholders that have been pressuring the company to consider offers.

"We believe such a tactic flies in the face of fiduciary responsibility and flatly contradicts the notion of maximizing value for all shareholders," he said.

NorthWestern, based in South Dakota, sells electricity in Montana to 310,000 customers and natural gas to 166,000 customers.

Copyright © 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


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