TXU Sale Complete - KLTV.com - Tyler, Longview, Jacksonville |ETX News

10/10/2007-East Texas

TXU Sale Complete

Going from public to private. It's a 45 billion dollar deal for TXU and that means more than 2 million TXU customers in Texas will send their monthly bills to a company with new owners, and a whole lot more debt.

It was signed off weeks ago approved by shareholders for TXU to be handled by two of the biggest private equity firms. As part of the deal, investors plan to borrow 24.5 billion dollars in new debt and refinanced old debt.

"We have to be addressed in some way but it depends upon the structure of the financial's of the company," said LeTourneau University Economics and Finance Professor John Feezell says depending how that debt is addressed will determine how that will affect your rates.

"All debt has to be addressed in some way. The issue is do I have to address it tomorrow morning?" said Feezell,"I would expect it to benefit the consumers over the long haul because there are forces that say we need to compete."

But the AARP and other consumer groups have repeatedly expressed concern that this buyout will significantly increase rates for consumers in the months and years ahead.

TXU, however, says this will bring significant benefits to consumers.

"First off they will receive an additional 5% of 15% reduction in the next 15 to 30 days," said Sophia Stoller, TXU Energy Spokesperson.

They also say the new ownership is committed to helping low income customers increased money for their Energy Aid Program.

"On the average we serve about 20 people per day on utility assistance," said Christina Fulsom Executive Director of P.A.T.H..

P.A.T.H. helps low income Smith County residents who qualify to get help.

"This year we received $120,000 and that amount can go up if the need increases," said Fulsom, and if rates go up "Definitely it may become a burden to our clients and to P.A.T.H."

For now, the deal is done and only time will tell what this will mean in the long run. With the completion of the merger, TXU Corp. has changed its name to Energy Future Holdings Corp.

Danielle Capper, Reporting. dcapper@kltv.com

 

Powered by Frankly