SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report
(Date of earliest event reported):
March 14, 2002
DUKE ENERGY CORPORATION
(Exact Name of Registrant as Specified in Charter)
NORTH CAROLINA 1-4928 56-0205520
(State or Other Jurisdiction of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
526 South Church Street
Charlotte, North Carolina 28202-1904
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 704-594-6200
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Item 2. Acquisition or Disposition of Assets
On March 14, 2002, Duke Energy Corporation completed its acquisition of
Westcoast Energy Inc. pursuant to an arrangement under Section 192 of the Canada
Business Corporations Act. As provided in the arrangement, Duke Energy acquired
all of the outstanding common shares of Westcoast Energy in exchange for a
combination of cash, Duke Energy common shares and exchangeable shares of Duke
Energy Canada Exchangeco Inc., a Canadian subsidiary of Duke Energy, such that
approximately 50% of the consideration was paid in cash and approximately 50%
was paid in stock. As a result, Westcoast Energy became an indirect subsidiary
of Duke Energy. Westcoast Energy is a leading North American energy company with
assets of approximately Cdn$14 billion. Westcoast Energy's interests include
natural gas gathering, processing, transmission, storage and distribution, as
well as power generation, international energy businesses, and financial,
information technology and energy services businesses.
Under the terms of the arrangement, each Westcoast common share was
exchanged, at the election of each holder, for (i) Cdn$43.80 in cash, (ii)
0.7711 of a Duke Energy common share or of an exchangeable share of Duke Energy
Canada Exchangeco, or (iii) a combination of such consideration. The
exchangeable shares are Canadian securities which began trading on the Toronto
Stock Exchange on March 14, 2002 under the symbol "DX." The exchangeable shares
have the same voting rights and economic attributes as Duke Energy common
shares, and each exchangeable share is exchangeable for one Duke Energy common
share.
Because valid elections for cash were received with respect to more than
50% of the outstanding Westcoast common shares, all holders of Westcoast common
shares who elected to exchange some or all of their Westcoast common shares for
cash are subject to the proration provisions of the transaction that provide
that approximately 50% of the aggregate consideration in the transaction will be
paid in cash and approximately 50% of the aggregate consideration will be paid
in stock. As a result, approximately 99% of each holder's Westcoast common
shares for which cash was validly elected were exchanged for cash and the
remaining approximately 1% were exchanged for either Duke Energy common shares
or exchangeable shares. All holders of Westcoast common shares who failed to
submit a valid election received Duke Energy common shares or exchangeable
shares.
Based upon the 129,458,191 Westcoast common shares outstanding at the
effective time of the arrangement, Duke Energy issued approximately 49.9 million
Duke Energy common shares and exchangeable shares of Duke Energy Canada
Exchangeco and paid approximately US$1.8 billion in cash. The cash portion of
the consideration was funded with the proceeds from the issuance of US$750
million in mandatory convertible equity issued in November 2001 along with
incremental commercial paper. The commercial paper is expected to be repaid
later this year and replaced by a permanent layer of capital in the form of
mandatory convertible equity.
In addition, each option to purchase a Westcoast common share outstanding
at the effective time was assumed by Duke Energy and became an option to
purchase 0.7711 of a Duke Energy common share. Based upon options to purchase
approximately 3,562,000 Westcoast common shares outstanding at the effective
time, Duke Energy assumed the obligation to issue approximately 2,746,000 Duke
Energy common shares, as adjusted to eliminate options for fractional shares.
No fractional shares will be issued in connection with the arrangement.
Holders of Westcoast common shares who would otherwise be entitled to receive
fractional shares of Duke Energy Common Stock will receive cash as set forth in
the plan of arrangement.
Duke Energy Gas Transmission will operate the former Westcoast Energy
transmission, storage and distribution systems while the energy services
business units of Duke Energy will operate the energy services and international
businesses formerly operated by Westcoast Energy.
A copy of the press release issued by Duke Energy on March 14, 2002 with
respect to the closing of the arrangement is attached hereto as Exhibit 99.1 and
is incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
The following exhibit is filed herewith:
99.1 Press Release of registrant dated March 14, 2002
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DUKE ENERGY CORPORATION
By: /s/ Stephen G. De May
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Stephen G. De May
Vice President, Business Unit Finance
Dated: March 28, 2002
EXHIBIT INDEX
Exhibit Description
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99.1 Press Release of registrant dated March 14, 2002