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Florida Progress getting attention

The name of a new suitor for Florida Progress Corp. has emerged 14 days after Scottish Power PLC backed away from a deal with the St. Petersburg power company.

PacifiCorp, an Oregon energy company stretching across seven Western states, is the latest company said to be in talks with Florida Progress. PacifiCorp's name first emerged in an article in London's Sunday Times, as a company "believed to be planning an approach for Florida Progress, valued at $3.5-billion."

Florida Progress spokeswoman Melanie Forbrick said in response to the PacifiCorp name that "we do not comment on matters pertaining to strategic transactions." Forbrick said PacifiCorp was the only new name to appear in news reports tied to Florida Progress since the Scottish Power deal fell through April 22.

"To my knowledge, it's the only utility _ but probably not the last," she said in reference to the active industry rumor mill that considers Florida Progress and its utility, Florida Power Corp., to be in play.

In Portland, Ore., PacifiCorp spokesman Dave Kvamme said he had no comment as a matter of company policy. But he said PacifiCorp, which has been a bidder for a power company in the United Kingdom, "has been in the U.K. press almost daily. I imagine there is a lot of speculation going on."

Shares of Florida Progress gained 25 cents Monday, closing at $40.87{, on modest volume of 177,800 shares. PacifiCorp shares closed at $23.06\, down 6\ cents.

Florida Progress, at first declining to comment April 23 on a possible Scottish Power deal, acknowledged one day later that it had been in serious takeover negotiations with the Glasgow, Scotland, power company. Scottish Power confirmed it had taken a close look at Florida Power during a period of "due diligence" but had decided to back away April 22 from a deal it called overpriced. The British press reported the proposed transaction at nearly $4-billion.

PacifiCorp caught the attention of the British press recently because the company was an aggressive bidder for one of Britain's largest power companies, the Energy Group PLC. PacifiCorp's bid, valued in excess of $10-billion for the British company, was topped by Texas Utilities Co. PacifiCorp dropped out of the bidding last week.

With PacifiCorp no longer in pursuit of the Energy Group, one thing is clear: The Oregon power company still has an immense war chest available to fund acquisitions.

PacifiCorp, for example, bought Utah Power & Light in 1989, creating opportunities to provide power more efficiently to 1.4-million customers in seven Western states. The company in 1997 acquired Houston-based TPC Corp., a natural gas marketing business. It also owns Powercor, an Australian power distributor with 550,000 customers.

Whether a PacifiCorp-Florida Power deal would pass regulatory muster remains unclear. Federal power regulators are encouraging mergers between utilities in contiguous markets that offer the potential to cut costs and, in theory, offer the possibility of lower electricity rates. Regulators appear less warm to distant deals that promise less cost savings.

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