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Press Releases
Black Hills Corporation
Announces Agreement
to Sell Communications Subsidiary
For Information Contact:
Mark T. Thies, Executive
Vice President; Dale
T. Jahr, Director, Investor Relations
RAPID CITY, SD—April 20, 2005—Black
Hills Corporation (NYSE: BKH) today announced it has entered
into a definitive agreement to sell its communications subsidiary,
Black Hills FiberCom and related businesses, to PrairieWave
Communications, Inc.
Under the purchase and sale agreement, the Company would
receive a cash payment of approximately $103 million upon
closing. The transaction is subject to certain state and
federal regulatory approvals, and is expected to be completed
prior to June 30, 2005. The Company expects to record a
one-time loss of approximately ($0.09) per share on the
sale.
David R. Emery, President and CEO of Black Hills Corporation,
said, “In the mid 1990s, our Company faced the possibility
of the deregulation of retail electric utility services
and we saw the need for advanced communication services
in our region. In response, we commenced the construction
of FiberCom to diversify our services in our retail service
territory. With utility deregulation less likely now, and
having brought broadband to Rapid City and the northern
Black Hills, we have decided to divest our communications
business so that we can focus solely on further developing
our core energy businesses.” Emery concluded, “With
the cash proceeds of the pending transaction, we would have
additional resources either to reduce our debt or to redeploy
capital in energy projects in the West.”
Craig A. Anderson, Chairman and CEO of PrairieWave, said,
“Our organization is excited about the pending purchase
of Black Hills FiberCom and the opportunity it represents
for us. The Rapid City and northern Black Hills region is
a very attractive market to us, and we look forward to serving
our new, valued customers enthusiastically and proficiently
with an elevated level of personal, local customer service.”
ABOUT BLACK HILLS CORPORATION
Black Hills Corporation is a diverse energy and communications
company. Black Hills Energy, the wholesale energy unit,
generates electricity, produces natural gas, oil and coal,
and markets energy. Our retail businesses are Black Hills
Power, an electric utility serving western South Dakota,
northeastern Wyoming and southeastern Montana; the recently
acquired Cheyenne Light, Fuel & Power, an electric and
gas distribution company serving the Cheyenne, Wyoming vicinity;
and Black Hills FiberCom, a broadband communications company,
which offers bundled telephone, high speed Internet, and
cable entertainment services, and which is under agreement
to be sold. More information is available at our Internet
web site: www.blackhillscorp.com.
ABOUT PRAIRIEWAVE COMMUNICATIONS
PrairieWave Communications, Inc. is a broadband communications
company providing telephone, cable TV and Internet services
in 36 markets in southeastern South Dakota, southwestern
Minnesota and northwestern Iowa.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Some of the statements in this release include “forward-looking
statements” as defined by the Securities and Exchange
Commission, or SEC. Black Hills Corporation makes these
forward-looking statements in reliance on the safe harbor
protections provided under the Private Securities Litigation
Reform Act of 1995. All statements, other than statements
of historical facts, included in this release that address
activities, events or developments that Black Hills expects,
believes or anticipates will or may occur in the future
are forward-looking statements. These forward-looking statements
are based on assumptions, which Black Hills believes are
reasonable based on current expectations and projections
about future events and industry conditions and trends affecting
Black Hills’ business. However, whether actual results
and developments will conform to Black Hills’ expectations
and predictions is subject to
a number of risks and uncertainties that could cause actual
results to differ materially from those contained
in the forward-looking statements, including, among other
things:
- The amount and timing of capital deployment in new investment
opportunities or for the repurchase of debt or stock;
- The volumes of our production from oil and gas development
properties, which may be dependent upon issuance by federal,
state, and tribal governments, or agencies thereof, of drilling,
environmental and other permits, and the availability of
specialized contractors, work force, and equipment;
- The extent of our success in connecting natural gas supplies
to gathering, processing and pipeline systems;
- Our ability to successfully integrate CLF&P into our
operations;
- Our compliance with orders of the SEC under PUHCA related
to our financing and investment authority, and related to
transactions and cost allocation among our affiliated companies;
- Our ability to remedy any deficiencies that may be identified
in the review of our internal controls;
- The timing and extent of changes in energy-related and
commodity prices, interest rates, energy and commodity supply
or volume, the cost of transportation of commodities, and
demand for our services, all of which can affect our earnings,
liquidity position and the underlying value of our assets;
- General economic and political conditions, including tax
rates or policies and inflation rates;
- Our use of derivative financial instruments to hedge commodity,
currency exchange rate and interest rate risks;
- The creditworthiness of counterparties to trading and
other transactions, and defaults on amounts due from counterparties;
- The amount of collateral required to be posted from time
to time in our transactions;
- Changes in or compliance with laws and regulations, particularly
those relating to taxation, safety and protection of the
environment;
- Changes in state laws or regulations that could cause
us to curtail our independent power production;
- Weather and other natural phenomena;
- Industry and market changes, including the impact of consolidations
and changes in competition;
- The effect of accounting policies issued periodically
by accounting standard-setting bodies;
- The cost and effects on our business, including insurance,
resulting from terrorist actions or responses to such actions;
- Capital market conditions, which may affect our ability
to raise capital on favorable terms;
- Price risk due to marketable securities held as investments
in benefit plans;
- Obtaining adequate cost recovery for our retail operations
through regulatory proceedings; and
- Other factors discussed from time to time in our other
filings with the SEC.
New factors that could cause actual results
to differ materially from those described in forward-looking
statements emerge from time to time, and it is not possible
for us to predict all such factors, or the extent to which
any such factor or combination of factors may cause actual
results to differ from those contained in any forward-looking
statement. We assume no obligation to update publicly our
forward-looking statements, whether as a result of new information,
future events or otherwise.
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Black Hills Corporation - Investor Relations
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