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Date: Mon, 07 May 2001 16:00:17 -0500
From: "Tracey Bradley" <tbradley@bracepatt.com>
To: "Justin Long" <jlong@bracepatt.com>, "Paul Fox" <pfox@bracepatt.com>
Cc: "Dan Watkiss" <dwatkiss@bracepatt.com>, "Ronald Carroll" 
<rcarroll@bracepatt.com>
Subject: Calif. Gov. says near deal to buy SDG&E power grid
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FYI

Monday May 7, 4:37 pm Eastern Time

Calif. Gov. says near deal to buy SDG&E power grid

LOS ANGELES, May 7 (Reuters) - California Gov. Gray Davis, seeking to piece 
together a takeover of the state's power transmission grid, said Monday he 
hoped to have an agreement by the end of the week to buy the high voltage 
power lines owned by Sempra Energy (NYSE:SRE - news) utility subsidiary San 
Diego Gas & Electric (SDG&E).

``I think that will be resolved, hopefully before the week is out ... I 
believe we are very, very close to resolving that issue,'' Davis told a news 
conference here.

Davis has made state ownership of the transmission grid a key part of his 
plan to solve the state's energy crisis and revive its three cash-strapped 
investor owned utilities.

SDG&E owns about 1,800 miles (2,897 km) of transmission lines. The deal is 
believed to be priced at roughly $1 billion plus the assumption of around 200 
million of debt, which equates to around 2.3 times book value

Davis has reached a tentative agreement to buy Edison International (NYSE:EIX 
- news) unit Southern California Edison's transmission grid for $2.76 
billion, also roughly 2.3 times its book value.

Similar talks to buy the grid belonging to San Francisco- based Pacific Gas 
and Electric Co., a unit of PG&E Corp. (NYSE:PCG - news) collapsed in early 
April when the utility put itself into voluntary bankruptcy protection.