Filed by FirstEnergy Corp.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934, as amended
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934, as amended
Subject Company: Allegheny Energy, Inc.
Commission File No: 333-165640
Commission File No: 333-165640
On June
1, 2010, FirstEnergy Corp. and Allegheny Energy, Inc. published the
following state regulatory filing fact sheets.
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
In addition to historical information, this fact sheet may contain a number of “forward-looking
statements” as defined in the Private Securities Litigation Reform Act of 1995. Words such as
anticipate, expect, project, intend, plan, believe, and words and terms of similar substance used
in connection with any discussion of future plans, actions, or events identify forward-looking
statements. Forward-looking statements relating to the proposed merger include, but are not limited
to: statements about the benefits of the proposed merger involving FirstEnergy and Allegheny
Energy, including future financial and operating results; FirstEnergy’s and Allegheny Energy’s
plans, objectives, expectations and intentions; the expected timing of completion of the
transaction; and other statements relating to the merger that are not historical facts.
Forward-looking statements involve estimates, expectations and projections and, as a result, are
subject to risks and uncertainties. There can be no assurance that actual results will not
materially differ from expectations. Important factors could cause actual results to differ
materially from those indicated by such forward-looking statements. With respect to the proposed
merger, these factors include, but are not limited to: risks and uncertainties relating to the
ability to obtain the requisite FirstEnergy and Allegheny Energy shareholder approvals; the risk
that FirstEnergy or Allegheny Energy may be unable to obtain governmental and regulatory approvals
required for the merger, or required governmental and regulatory approvals may delay the merger or
result in the imposition of conditions that could reduce the anticipated benefits from the merger
or cause the parties to abandon the merger; the risk that a condition to closing of the merger may
not be satisfied; the length of time necessary to consummate the proposed merger; the risk that the
businesses will not be integrated successfully; the risk that the cost savings and any other
synergies from the transaction may not be fully realized or may take longer to realize than
expected; disruption from the transaction making it more difficult to maintain relationships with
customers, employees or suppliers; the diversion of management time on merger-related issues; the
effect of future regulatory or legislative actions on the companies; and the risk that the credit
ratings of the combined company or its subsidiaries may be different from what the companies
expect. These risks, as well as other risks associated with the merger, are more fully discussed in
the preliminary joint proxy statement/prospectus that is included in the Registration Statement on
Form S-4 (Registration No. 333-165640) that was filed by FirstEnergy with the SEC in connection
with the merger. Additional risks and uncertainties are identified and discussed in FirstEnergy’s
and Allegheny Energy’s reports filed with the SEC and available at the SEC’s website at
www.sec.gov. Forward-looking statements included in this document speak only as of the date of this
document. Neither FirstEnergy nor Allegheny Energy undertakes any obligation to update its
forward-looking statements to reflect events or circumstances after the date of this document.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed merger, FirstEnergy filed a Registration Statement on Form S-4
(Registration No. 333-165640) with the SEC that includes a preliminary joint proxy statement of
FirstEnergy and Allegheny Energy and that also constitutes a preliminary prospectus of FirstEnergy.
FirstEnergy and Allegheny Energy will mail the definitive joint proxy statement/prospectus to their
respective shareholders. FirstEnergy and Allegheny Energy urge investors and shareholders to read
the definitive joint proxy statement/prospectus regarding the proposed merger when it becomes
available, as well as other documents filed with the SEC, because they will contain important
information. You may obtain copies of all documents filed with the SEC regarding this proposed
transaction, free of charge, at the SEC’s website (www.sec. gov). You may also obtain these
documents, free of charge, from FirstEnergy’s website (www.firstenergycorp.com) under the tab
“Investors” and then under the heading “Financial Information” and then under the item “SEC
Filings.” You may also obtain these documents, free of charge, from Allegheny Energy’s website
(www.alleghenyenergy.com) under the tab “Investors” and then under the heading “SEC Filings.”
PARTICIPANTS IN THE MERGER SOLICITATION
FirstEnergy, Allegheny Energy and their respective directors, executive officers and certain other
members of management and employees may be soliciting proxies from FirstEnergy and Allegheny Energy
shareholders in favor of the merger and related matters. Information regarding the persons who may,
under the rules of the SEC, be deemed participants in the solicitation of FirstEnergy and Allegheny
Energy shareholders in connection with the proposed merger is set forth in the preliminary joint
proxy statement/prospectus contained in the above-referenced Registration Statement on Form S-4.
You can find information about FirstEnergy’s executive officers and directors in its definitive
proxy statement filed with the SEC on April 1, 2010 and Annual Report on Form 10-K filed with the
SEC on February 19, 2010. You can find information about Allegheny Energy’s executive officers and
directors in its definitive proxy statement filed with the SEC on March 19, 2010 and Annual Report
on Form 10-K filed with the SEC on March 1, 2010. Additional information about FirstEnergy’s
executive officers and directors and Allegheny Energy’s executive officers and directors can be
found in the above-referenced Registration Statement on Form S-4. You can obtain free copies of
these documents from FirstEnergy and Allegheny Energy using the website information above.
What the FirstEnergy/Allegheny Energy merger means to
Maryland
The merger of FirstEnergy and Allegheny Energy would create a larger, stronger company, providing
benefits to the customers and communities that are served by its electric distribution companies.
The combination is a natural fit of two companies with contiguous service areas, similar business
models and a strong focus on both regulated utility operations and a competitive generation
business. Together, the companies have the potential to produce operating efficiencies and
economies of scale as they share best practices across the new organization.
In a recent application with the Maryland Public Service Commission, the companies committed to the
following benefits for customers and communities in Maryland upon approval of the application as
filed:
No Utility Job Reductions
For at least two years there will be no net job losses in the utility operations of Potomac Edison
in Maryland as a result of involuntary attrition related to the integration process of the two
companies.
Regional Headquarters in Maryland
The company will establish a regional headquarters for Potomac Edison within the utility’s Maryland
service area.
Local Presence and Decision Making
FirstEnergy’s regional management approach, which supports local decision-making authority and
accountability, would be implemented at Potomac Edison after the merger. Regional presidents are in
place at FirstEnergy electric utility distribution companies, and their staffs are responsible for
day-to-day operations, community involvement and economic development activities.
Ongoing Support for Local Communities
The combined company will continue to support economic development and community initiatives for
the next three years at levels that are consistent with Allegheny Energy’s historic support. After
that, support will continue at levels consistent with other FirstEnergy operating companies.
Commitment to Customer Service Reliability
The Allegheny Power utility companies will maintain service reliability standards, as currently
measured, and study whether opportunities exist for improvement.
Customer Rate Benefits
The merger is expected to generate cost savings related to operating efficiencies and employing
best practices. Savings related to utility operations would help mitigate future rate increases, as
lower operating costs offset future increases.
Continued on next page
Monthly Credit for Customers
FirstEnergy will provide a direct monthly credit for Potomac Edison residential customers in
Maryland that equals 25 percent of the allowed return on the cost of providing customer generation
service. This represents approximately a $2.5 million benefit to these customers over two years.
Support for Competitive Markets
FirstEnergy’s competitive generation affiliate – FirstEnergy Solutions – will become a certified
retail supplier for residential customers in Maryland and continue to actively participate in
competitive retail markets, providing options that promote competition and lower prices to
customers.
Continuation of Collective Bargaining Agreements
The combined company will honor Allegheny Energy’s collective bargaining agreements that are
currently in place, including all terms and conditions of those agreements.
Key benefits of the merger include:
| • | Adjacent geographic footprints, enabling mutual support and enhanced customer service | |
| • | Nearly 20,000 miles of transmission lines, with improved operation and coordination as a result of the network’s larger scale and scope | |
| • | Planned growth in the transmission business with major projects underway | |
| • | More than 24,000 megawatts of generating capacity with a favorable environmental profile: a diverse mix of fully scrubbed baseload fossil, non-emitting nuclear, and more than 2,200 megawatts of renewable resources, including large-scale energy storage | |
| • | Based on capacity, 68 percent of the combined, coal-based fleet would be highly efficient, supercritical generation – compared with the national average of 28 percent |
Maryland Operations at a Glance:
| • | Customers: 250,620 | |
| • | Employees: 379 | |
| • | Square Miles: 2,500 |
Timing
The merger of Allegheny Energy and
FirstEnergy has been supported unanimously by the boards of directors of both companies. A
registration statement on Form S-4 also has been filed with the U.S. Securities and Exchange
Commission. In addition, the companies have submitted the necessary merger filings with the Federal
Energy Regulatory Commission and the state utility commissions in Pennsylvania, Maryland and West
Virginia.
The companies will each hold special meetings of shareholders to approve proposals related to the
merger.
The merger is expected to be completed in the first half of 2011, subject to customary closing
conditions, including shareholder and regulatory approvals.
Who is FirstEnergy?
FirstEnergy is a Fortune 200 company with approximately $13 billion in annual revenues. Its seven
electric distribution companies comprise the nation’s fifth largest investor-owned electric system,
based on 4.5 million customers served in Ohio, Pennsylvania and New Jersey, and its generating
subsidiaries control more than 14,000 megawatts of capacity.
FirstEnergy was formed following the 1997 merger of Ohio Edison and Centerior Energy Corporation.
The company expanded across Pennsylvania and into New Jersey with the 2001 merger with GPU, Inc.
These mergers have strengthened FirstEnergy, resulting in enhanced customer service reliability,
improved safety performance, expanded opportunities for employees and increased investment growth
potential for shareholders.
Continued on next page
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
In addition to historical information, this fact sheet may contain a number of “forward-looking
statements” as defined in the Private Securities Litigation Reform Act of 1995. Words such as
anticipate, expect, project, intend, plan, believe, and words and terms of similar substance used
in connection with any discussion of future plans, actions, or events identify forward-looking
statements. Forward-looking statements relating to the proposed merger include, but are not limited
to: statements about the benefits of the proposed merger involving FirstEnergy and Allegheny
Energy, including future financial and operating results; FirstEnergy’s and Allegheny Energy’s
plans, objectives, expectations and intentions; the expected timing of completion of the
transaction; and other statements relating to the merger that are not historical facts.
Forward-looking statements involve estimates, expectations and projections and, as a result, are
subject to risks and uncertainties. There can be no assurance that actual results will not
materially differ from expectations. Important factors could cause actual results to differ
materially from those indicated by such forward-looking statements. With respect to the proposed
merger, these factors include, but are not limited to: risks and uncertainties relating to the
ability to obtain the requisite FirstEnergy and Allegheny Energy shareholder approvals; the risk
that FirstEnergy or Allegheny Energy may be unable to obtain governmental and regulatory approvals
required for the merger, or required governmental and regulatory approvals may delay the merger or
result in the imposition of conditions that could reduce the anticipated benefits from the merger
or cause the parties to abandon the merger; the risk that a condition to closing of the merger may
not be satisfied; the length of time necessary to consummate the proposed merger; the risk that the
businesses will not be integrated successfully; the risk that the cost savings and any other
synergies from the transaction may not be fully realized or may take longer to realize than
expected; disruption from the transaction making it more difficult to maintain relationships with
customers, employees or suppliers; the diversion of management time on merger-related issues; the
effect of future regulatory or legislative actions on the companies; and the risk that the credit
ratings of the combined company or its subsidiaries may be different from what the companies
expect. These risks, as well as other risks associated with the merger, are more fully discussed in
the preliminary joint proxy statement/prospectus that is included in the Registration Statement on
Form S-4 (Registration No. 333-165640) that was filed by FirstEnergy with the SEC in connection
with the merger. Additional risks and uncertainties are identified and discussed in FirstEnergy’s
and Allegheny Energy’s reports filed with the SEC and available at the SEC’s website at
www.sec.gov. Forward-looking statements included in this document speak only as of the date of this
document. Neither FirstEnergy nor Allegheny Energy undertakes any obligation to update its
forward-looking statements to reflect events or circumstances after the date of this document.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed merger, FirstEnergy filed a Registration Statement on Form S-4
(Registration No. 333-165640) with the SEC that includes a preliminary joint proxy statement of
FirstEnergy and Allegheny Energy and that also constitutes a preliminary prospectus of FirstEnergy.
FirstEnergy and Allegheny Energy will mail the definitive joint proxy statement/prospectus to their
respective shareholders. FirstEnergy and Allegheny Energy urge investors and shareholders to read
the definitive joint proxy statement/prospectus regarding the proposed merger when it becomes
available, as well as other documents filed with the SEC, because they will contain important
information. You may obtain copies of all documents filed with the SEC regarding this proposed
transaction, free of charge, at the SEC’s website (www.sec. gov). You may also obtain these
documents, free of charge, from FirstEnergy’s website (www.firstenergycorp.com) under the tab
“Investors” and then under the heading “Financial Information” and then under the item “SEC
Filings.” You may also obtain these documents, free of charge, from Allegheny Energy’s website
(www.alleghenyenergy.com) under the tab “Investors” and then under the heading “SEC Filings.”
PARTICIPANTS IN THE MERGER SOLICITATION
FirstEnergy, Allegheny Energy and their respective directors, executive officers and certain other
members of management and employees may be soliciting proxies from FirstEnergy and Allegheny Energy
shareholders in favor of the merger and related matters. Information regarding the persons who may,
under the rules of the SEC, be deemed participants in the solicitation of FirstEnergy and Allegheny
Energy shareholders in connection with the proposed merger is set forth in the preliminary joint
proxy statement/prospectus contained in the above-referenced Registration Statement on Form S-4.
You can find information about FirstEnergy’s executive officers and directors in its definitive
proxy statement filed with the SEC on April 1, 2010 and Annual Report on Form 10-K filed with the
SEC on February 19, 2010. You can find information about Allegheny Energy’s executive officers and
directors in its definitive proxy statement filed with the SEC on March 19, 2010 and Annual Report
on Form 10-K filed with the SEC on March 1, 2010. Additional information about FirstEnergy’s
executive officers and directors and Allegheny Energy’s executive officers and directors can be
found in the above-referenced Registration Statement on Form S-4. You can obtain free copies of
these documents from FirstEnergy and Allegheny Energy using the website information above.
What the FirstEnergy/Allegheny Energy merger means to
Pennsylvania
The merger of FirstEnergy and Allegheny Energy would create a larger, stronger company, providing
benefits to the customers and communities that are served by its electric distribution companies.
The combination is a natural fit of two companies with contiguous service areas, similar business
models and a strong focus on both regulated utility operations and a competitive generation
business. Together, the companies have the potential to produce operating efficiencies and
economies of scale as they share best practices across the new organization.
In a recent application with the Pennsylvania Public Utility Commission, the companies committed to
the following benefits for customers and communities in Pennsylvania upon approval of the
application as filed:
No Utility Job Reductions
For at least two years there will be no net job losses at the utility operating companies as a
result of involuntary attrition related to the integration process of the two companies.
Regional Headquarters will be Located in Greensburg
The current headquarters building of Allegheny Energy will be used as the headquarters of West Penn
Power.
Local Presence and Decision Making
FirstEnergy’s regional management approach, which supports local decision-making authority and
accountability, would be implemented at West Penn Power after the merger. Regional presidents are
in place at Met-Ed and Penelec, and their staffs are responsible for
day-to-day operations,
community involvement and economic development activities.
New Education and Jobs Initiatives
FirstEnergy will work with local community colleges to establish a new Power Systems Institute
(PSI) program in Pennsylvania. PSI is FirstEnergy’s award-winning partnership to educate and train
future utility workers. There are three PSI schools currently in Pennsylvania – in Oil City,
Johnstown and Reading.
Ongoing Support for Local Communities
The combined company will continue to support economic development and community initiatives for
the next three years at levels that are consistent with Allegheny Energy’s historic support. After
that, support will continue at levels consistent with other FirstEnergy operating companies.
Commitment to Customer Service Reliability
The Allegheny Power utility companies will maintain service reliability standards, as currently
measured, and study whether opportunities exist for improvement.
Continued on next page
Customer Rate Benefits
The merger is expected to generate cost savings related to operating efficiencies and employing
best practices. Savings related to utility operations would help mitigate future rate increases, as
lower operating costs offset future increases.
Support for Competitive Markets
FirstEnergy’s competitive generation affiliate – FirstEnergy Solutions – will continue to actively
participate in competitive retail markets, providing options that promote competition and lower
prices to customers.
Continuation of Collective Bargaining Agreements
The combined company will honor Allegheny Energy’s collective bargaining agreements that are
currently in place, including all terms and conditions of those agreements.
Key benefits of the merger include:
| • | Adjacent geographic footprints, enabling mutual support and enhanced customer service | |
| • | Nearly 20,000 miles of transmission lines, with improved operation and coordination as a result of the network’s larger scale and scope | |
| • | Planned growth in the transmission business with major projects underway | |
| • | More than 24,000 megawatts of generating capacity with a favorable environmental profile: a diverse mix of fully scrubbed baseload fossil, non-emitting nuclear, and more than 2,200 megawatts of renewable resources, including large-scale energy storage | |
| • | Based on capacity, 68 percent of the combined, coal-based fleet would be highly efficient, supercritical generation – compared with the national average of 28 percent |
Pennsylvania Operations* at a Glance:
| • | Customers: 2 million | |
| • | Employees: 6,159 | |
| • | Square Miles: 32,000 |
* Post-merger footprint based on combined figures for 2009
Continued on next page
Timing
The merger of Allegheny Energy and
FirstEnergy has been supported unanimously by the boards of directors of both companies. A
registration statement on Form S-4 also has been filed with the U.S. Securities and Exchange
Commission. In addition, the companies have submitted the necessary merger filings with the Federal
Energy Regulatory Commission and the state utility commissions in Pennsylvania, Maryland and West
Virginia.
The companies will each hold special meetings of shareholders to approve proposals related to the
merger.
The merger is expected to be completed in the first half of 2011, subject to customary closing
conditions, including shareholder and regulatory approvals.
Who is FirstEnergy?
FirstEnergy is a Fortune 200 company with approximately $13 billion in annual revenues. Its seven
electric distribution companies comprise the nation’s fifth largest investor-owned electric system,
based on 4.5 million customers served in Ohio, Pennsylvania and New Jersey, and its generating
subsidiaries control more than 14,000 megawatts of capacity.
FirstEnergy was formed following the 1997 merger of Ohio Edison and Centerior Energy Corporation.
The company expanded across Pennsylvania and into New Jersey with the 2001 merger with GPU, Inc.
These mergers have strengthened FirstEnergy, resulting in enhanced customer service reliability,
improved safety performance, expanded opportunities for employees and increased investment growth
potential for shareholders.
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
In addition to historical information, this fact sheet may contain a number of “forward-looking
statements” as defined in the Private Securities Litigation Reform Act of 1995. Words such as
anticipate, expect, project, intend, plan, believe, and words and terms of similar substance
used in connection with any discussion of future plans, actions, or events identify
forward-looking statements. Forward-looking statements relating to the proposed merger include,
but are not limited to: statements about the benefits of the proposed merger involving
FirstEnergy and Allegheny Energy, including future financial and operating results;
FirstEnergy’s and Allegheny Energy’s plans, objectives, expectations and intentions; the
expected timing of completion of the transaction; and other statements relating to the merger
that are not historical facts. Forward-looking statements involve estimates, expectations and
projections and, as a result, are subject to risks and uncertainties. There can be no assurance
that actual results will not materially differ from expectations. Important factors could cause
actual results to differ materially from those indicated by such forward-looking statements.
With respect to the proposed merger, these factors include, but are not limited to: risks and
uncertainties relating to the ability to obtain the requisite FirstEnergy and Allegheny Energy
shareholder approvals; the risk that FirstEnergy or Allegheny Energy may be unable to obtain
governmental and regulatory approvals required for the merger, or required governmental and
regulatory approvals may delay the merger or result in the imposition of conditions that could
reduce the anticipated benefits from the merger or cause the parties to abandon the merger; the
risk that a condition to closing of the merger may not be satisfied; the length of time
necessary to consummate the proposed merger; the risk that the businesses will not be
integrated successfully; the risk that the cost savings and any other synergies from the
transaction may not be fully realized or may take longer to realize than expected; disruption
from the transaction making it more difficult to maintain relationships with customers,
employees or suppliers; the diversion of management time on merger-related issues; the effect
of future regulatory or legislative actions on the companies; and the risk that the credit
ratings of the combined company or its subsidiaries may be different from what the companies
expect. These risks, as well as other risks associated with the merger, are more fully
discussed in the preliminary joint proxy statement/prospectus that is included in the
Registration Statement on Form S-4 (Registration No. 333-165640) that was filed by FirstEnergy
with the SEC in connection with the merger. Additional risks and uncertainties are identified
and discussed in FirstEnergy’s and Allegheny Energy’s reports filed with the SEC and available
at the SEC’s website at www.sec.gov. Forward-looking statements included in this document speak
only as of the date of this document. Neither FirstEnergy nor Allegheny Energy undertakes any
obligation to update its forward-looking statements to reflect events or circumstances after
the date of this document.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed merger, FirstEnergy filed a Registration Statement on Form S-4
(Registration No. 333-165640) with the SEC that includes a preliminary joint proxy statement of
FirstEnergy and Allegheny Energy and that also constitutes a preliminary prospectus of
FirstEnergy. FirstEnergy and Allegheny Energy will mail the definitive joint proxy
statement/prospectus to their respective shareholders. FirstEnergy and Allegheny Energy urge
investors and shareholders to read the definitive joint proxy statement/prospectus regarding
the proposed merger when it becomes available, as well as other documents filed with the SEC,
because they will contain important information. You may obtain copies of all documents filed
with the SEC regarding this proposed transaction, free of charge, at the SEC’s website
(www.sec. gov). You may also obtain these documents, free of charge, from FirstEnergy’s website
(www.firstenergycorp.com) under the tab “Investors” and then under the heading “Financial
Information” and then under the item “SEC Filings.” You may also obtain these documents, free
of charge, from Allegheny Energy’s website (www.alleghenyenergy.com) under the tab “Investors”
and then under the heading “SEC Filings.”
PARTICIPANTS IN THE MERGER SOLICITATION
FirstEnergy, Allegheny Energy and their respective directors, executive officers and certain
other members of management and employees may be soliciting proxies from FirstEnergy and
Allegheny Energy shareholders in favor of the merger and related matters. Information regarding
the persons who may, under the rules of the SEC, be deemed participants in the solicitation of
FirstEnergy and Allegheny Energy shareholders in connection with the proposed merger is set
forth in the preliminary joint proxy statement/prospectus contained in the above-referenced
Registration Statement on Form S-4. You can find information about FirstEnergy’s executive
officers and directors in its definitive proxy statement filed with the SEC on April 1, 2010
and Annual Report on Form 10-K filed with the SEC on February 19, 2010. You can find
information about Allegheny Energy’s executive officers and directors in its definitive proxy
statement filed with the SEC on March 19, 2010 and Annual Report on Form 10-K filed with the
SEC on March 1, 2010. Additional information about FirstEnergy’s executive officers and
directors and Allegheny Energy’s executive officers and directors can be found in the
above-referenced Registration Statement on Form S-4. You can obtain free copies of these
documents from FirstEnergy and Allegheny Energy using the website information above.
What the FirstEnergy/Allegheny Energy merger means to
West Virginia
The merger of FirstEnergy and Allegheny Energy would
create a larger, stronger company, providing benefits to the
customers and communities that are served by its electric
distribution companies. The combination is a natural fit of
two companies with contiguous service areas, similar business
models and a strong focus on both regulated utility operations
and a competitive generation business. Together, the companies
have the potential to produce operating efficiencies and
economies of scale as they share best practices across the new
organization.
In a recent application with the Public Service
Commission of West Virginia, the companies committed
to the following benefits for customers and
communities in West Virginia upon approval of the
application as filed:
No Utility Job Reductions
For at least two years there will be no net job
losses in the utility operations in West Virginia
as a result of involuntary attrition related to the
integration process of the two companies.
Maintain Regional Call Center in Fairmont
The combined company will not eliminate the
Allegheny Power Customer Call Center located in
Fairmont as a result of the merger integration
process.
Complete Transmission Operations Center
The combined company will complete and staff the
Fairmont transmission operations center, as
currently planned.
Local Presence and Decision Making
FirstEnergy’s regional management approach,
which supports local decision-making authority
and accountability, would be implemented at
Monongahela Power and Potomac Edison
after the merger. Regional presidents are in
place at FirstEnergy electric utility distribution
companies, and their staffs are responsible for
day-to-day operations, community involvement
and economic development activities.
New Education and Jobs Initiatives
FirstEnergy will work with local community
colleges to bring at least one new Power
Systems Institute (PSI) program to West
Virginia. PSI is FirstEnergy’s award-winning
partnership to educate and train future utility
workers. There are two similar programs
currently in West Virginia – in Weirton and
near Charleston – as well as two training
partnerships that Allegheny Energy has with
community and technical colleges in Fairmont
and Martinsburg.
Continued on next page
Ongoing Support for Local
Communities
The combined company will continue to support
economic development and community initiatives for
the next three years at levels that are consistent
with Allegheny Energy’s historic support. After
that, support will continue at levels consistent
with other FirstEnergy operating companies.
Commitment to Customer Service Reliability
The Allegheny Power utility companies will
maintain service reliability standards, as
currently measured, and study whether
opportunities exist for improvement.
Customer Rate Benefits
The merger is expected to generate cost savings
related to operating efficiencies and employing best
practices. Savings related to utility operations
would help mitigate future rate increases, as lower
operating costs offset future increases.
Continuation of Collective Bargaining Agreements
The combined company will honor Allegheny Energy’s
collective bargaining agreements that are currently
in place, including all terms and conditions of
those agreements.
Key benefits of the merger include:
| • | Adjacent geographic footprints, enabling mutual support and enhanced customer service | |
| • | Nearly 20,000 miles of transmission lines, with improved operation and coordination as a result of the network’s larger scale and scope | |
| • | Planned growth in the transmission business with major projects underway | |
| • | More than 24,000 megawatts of generating capacity with a favorable environmental profile: a diverse mix of fully scrubbed baseload fossil, non-emitting nuclear, and more than 2,200 megawatts of renewable resources, including large-scale energy storage | |
| • | Based on capacity, 68 percent of the combined, coal-based fleet would be highly efficient, supercritical generation — compared with the national average of 28 percent |
West Virginia Operations at a Glance:
| • | Customers: 516,628 | |
| • | Employees: 1,762 | |
| • | Square Miles: 15,600 |
Timing
The merger of Allegheny Energy and
FirstEnergy has been supported unanimously by the
boards of directors of both companies. A
registration statement on Form S-4 also has been
filed with the U.S. Securities and Exchange
Commission. In addition, the companies have
submitted the necessary merger filings with the
Federal Energy Regulatory Commission and the state
utility commissions in Pennsylvania, Maryland and
West Virginia.
The companies will each hold special meetings of
shareholders to approve proposals related to the
merger.
The merger is expected to be completed in the first
half of 2011, subject to customary closing
conditions, including shareholder and regulatory
approvals.
Who is FirstEnergy?
FirstEnergy is a Fortune 200 company with
approximately $13 billion in annual revenues. Its
seven electric distribution companies comprise
the nation’s fifth largest investor-owned
electric system, based on 4.5 million customers
served in Ohio, Pennsylvania and New Jersey, and
its generating subsidiaries control more than
14,000 megawatts of capacity.
FirstEnergy was formed following the 1997 merger of
Ohio Edison and Centerior Energy Corporation. The
company expanded across Pennsylvania and into New
Jersey with the 2001 merger with GPU, Inc. These
mergers have strengthened FirstEnergy, resulting in
enhanced customer service reliability, improved
safety performance, expanded opportunities for
employees and increased investment growth potential
for shareholders.
Continued on next page