|Cabot Oil & Gas Agrees to Repurchase Preferred Stock|
HOUSTON, Nov. 15 /PRNewswire/ -- Cabot Oil & Gas Corporation (NYSE: COG) today announced that it has reached agreement to repurchase, by November 1, 2000, all of its outstanding 6% convertible redeemable preferred stock, which is held by Puget Sound Energy, Inc. (NYSE: PSD). The agreement provides that Cabot Oil & Gas give Puget total consideration of $51.6 million for the preferred stock, which has a stated value of $56.7 million. Cabot is evaluating a variety of sources from which to fund this transaction. The Company may sell common stock or use other instruments under its universal shelf registration. Alternatively, Cabot may issue directly to Puget a mutually agreed upon number of common shares. Upon repurchase, Cabot intends to retire the preferred stock.
"We are pleased with the result of these negotiations," commented Ray R. Seegmiller, Chairman and Chief Executive Officer. "The benefits going forward after the retirement of the preferred stock include improving Cabot's capital structure while eliminating the $3.4 million annual preferred dividend. On a pro forma basis using common equity, the savings will have the impact of being accretive to net income, earnings per share and discretionary cash flow. However, the impact on discretionary cash flow per share will be slightly dilutive in the short term." Seegmiller added, "The timing of the closing has yet to be determined but the one-year window provides us with substantial flexibility."
Cabot Oil & Gas Corporation, headquartered in Houston, Texas, is a leading domestic independent natural gas producer and marketer with substantial interests in the Appalachia, Mid-Continent, Rocky Mountains and Gulf Coast basins. For additional information, visit the Company's internet home page at www.cabotog.com.
The statements regarding future financial performance and results and the
other statements which are not historical facts contained in this release are
forward-looking statements that involve risks and uncertainties, including,
but not limited to, market factors, the market price of natural gas and oil,
results of future drilling and marketing activity, future production and
costs, and other factors detailed in the Company's Securities and Exchange