FOR IMMEDIATE RELEASE
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ALLEGHENY ENERGY, INC.
ADOPTS STOCKHOLDER PROTECTION RIGHTS AGREEMENT
HAGERSTOWN, MD., MARCH 2, 2000 - Allegheny Energy, Inc. (NYSE: AYE) has
adopted a Stockholder Protection Rights Agreement.
The Rights Agreement is similar to plans adopted by more than 1,700
U.S. corporations, including about half of the Fortune 500 companies and an
increasing number of publicly traded utility companies. The Rights Agreement was
not adopted in response to any specific effort to acquire control of Allegheny
Energy. The Rights may cause substantial dilution to a person that acquires 15
percent or more of Allegheny Energy's common stock. Nevertheless, the Rights
should not interfere with a transaction that is in the best interests of
Allegheny Energy and its shareholders, because the Rights can be redeemed prior
to a triggering event for $0.01 per Right.
Xxxx X. Xxxx, Chairman, President, and Chief Executive Officer of
Allegheny Energy, stated that, "The Rights Agreement does not in any way weaken
Allegheny Energy's financial strength or interfere with its business plans. The
issuance of the Rights has no dilutive effect, will not affect reported earnings
per share, is not taxable to Allegheny Energy or its shareholders, and will not
change the way in which shares of Allegheny Energy common stock are traded."
Under the Rights Agreement, Rights will be distributed as a dividend at
the rate of one Right per each share of Allegheny Energy common stock. The
dividend will be paid to shareholders of record as of March 16, 2000.
Under its principal provision, if any person or group acquires 15
percent or more of Allegheny Energy's outstanding common stock, all other
shareholders of the Company would be entitled to buy, for the exercise price of
$100 per Right, common stock of Allegheny having a market value equal to twice
the exercise price, thereby substantially diluting the acquiring person's or
group's investment.
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The Securities and Exchange Commission previously issued an order
pursuant to the Public Utility Holding Company Act of 1935, as amended, granting
Allegheny Energy the authority to adopt and implement the Rights Agreement.
Allegheny Energy, Inc. is a diversified energy company headquartered in
Hagerstown, Md. The Allegheny Energy family includes Allegheny Power, which
delivers energy to about three million people in parts of Maryland, Ohio,
Pennsylvania, Virginia, and West Virginia; Allegheny Energy Supply Company, LLC,
which operates and markets competitive retail and wholesale electric generation
and operates regulated electric generation for its affiliates; and Allegheny
Ventures, which actively invests in and develops energy-related and
telecommunications projects. For more information, check our web site at
xxx.xxxxxxxxxxxxxxx.xxx.
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