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Milagro Power Signs Exclusive Letter of Intent for Customer Book Sale, Seeks Longer Deferral of Proposed Revocation Order
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March 18, 2011
Milagro Power Company (TexRep3) has asked the PUCT to further defer action on a pending proposed order which would revoke its REP certificate to allow for additional time to complete a contemplated purchase of Milagro's customer book.
As previously reported, the PUC has deferred action on the proposed revocation order until the March 24 open meeting (see 3/14 for more)
Milagro updated the Commission that it has entered into an exclusive Letter of Intent with a potential buyer to transfer Milagro's assets, including its license and customers, to another REP. Under the contemplated transaction, Milagro's 3,000 existing customer contracts would be honored by the acquiring REP, and customers would receive the same rate and terms as provided for in their contracts until their expiration.
Milagro filed the letter of intent under seal and did not identify the potential purchaser. However, Milagro did say that this party would be present at the March 24 open meeting.
Milagro said that there is a chance that the parties may sign, but not close, on a definitive asset purchase agreement prior to the March 24 open meeting. Milagro also said that while it would begin transferring customers as soon as possible under the acquisition, it is mindful of Commission rules regarding notice to affected customers and plans to fully comply with such regulations.
Accordingly, Milagro asked the Commission to defer action on the proposal for decision to permit an orderly winding down of the business. Milagro did not request a specific time period for the deferral.
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