PSE’s campaign for a “no” vote consists of scare tactics to sow fear, uncertainty and doubt, not the facts. Their “local” committee consists of employees of a political campaign firm in Seattle, whose address is the UPS mailbox store in Burlington. As of October 13, 2008 PSE has contributed over $ 420,334.65 of funds paid by customers to their committee in order to defeat PUD Proposition 1.

For more information there are two more websites:

http://www.sceanow.org/

http://www.savepse.org/

I’m fully vested in PSD at the moment, but if nothing comes up, I’ll either add a little more or wait it out. On the other hand, if news is bad, I’ve got to be ready to cut losses and work on the next opportunity.

I know some readers have bought PSD and are either scared or want to get in but feel uneasy. If this is the case, you would be best served to stay away and go long on great companies such as KO that offer stability and reliability. It’s much better to sleep comfortably at night.

Thanks for the link. I read something similar but of less detail this morning from this article.

After reading this article, my views on how this will affect the merger doesn’t change. Here are my thoughts.

The opposing counties are Skagit, Island and Jefferson. If you are not a resident of Washington state, these are the rural counties. This means less and lower paid jobs and a much smaller population.

If this proposition was to go forward, I’m uncertain as to how they will come up with $1 billion just to acquire the infrastructure alone. I don’t even know how much more it would cost to get it running. For all this to happen it’s probably going to come down to higher taxes from these people and increasing taxes is the last thing anyone wants in this economy.

Also, the worst case scenario of the PUD taking over would mean that PSE sell the infrastructure and lose customers in those counties. I don’t believe it would derail the deal, but it is a possibility. And if the proposition is passed, that would mean the rates would be regulated just like PSE. Washington state is a highly regulated state so nothing gets passed easily, but so far PSE has agreed to continue offering the same level of service even under new control. The UTC has also acknowledged that PSE meets the “no harm” requirement.

As a previous customer of PSE, I must admit that the rates were higher than what I wanted to pay, but the service is excellent. You just can’t beat them here. And a lot of people know this.

Lastly, looking at who paid the campaign bills for the Skagit PUD, it seems like of the $15,267.75 raised, only $1,450 was from cash donations. If this was such a big issue as the article implies, I would think more people would have donated. Even if each person donated $10, that’s only 140 people actively opposing it. Not enough to be a deal breaker.

Thanks a lot for helping with the additional research.

Best Wishes,
D4L

I think you’re right. They probably would need extra time. So the time frame would be about 3 weeks I guess.

Thanks for the write-up. A question for you: your article implies that the merger will go through in one week’s time as that’s the deadline for the reply brief submission.

However, I think UTC will also need some time to review the submission… and thus the rational for the mid/late-Nov time frame mentioned in Steve’s link.

Very true which is why I try to enter into an arbitrage once it is close to completion. Although I’m confident that this one would go through, I will still be anxious until the official announcement is made.

Thanks for the reminder.

I thought the same but I wanted to get my concerns through you anyways. I am still fearful as I still remember several deals failing in the summer and early fall of 2007 just when the credit crisis was beginning to worsen.. The arbitrageurs lost their shirts at the time..

@Steve
Thanks for this info but I don’t understand the following sentence.

“The UTC has still not issued a formal decision date and it is unclear at this time if it intends to do for this case. Nevertheless, with the reply brief deadline established, UTC approval is now anticipated in a mid/late-November time frame.”

I never got the impression that the UTC was on the fence. Also, I would be interested to know where I can get the info that states the mid/late Nov announcement.

@Sue
Glad you like the content and the layout

http://maresearch.com/psd.htm

What are the odds that the consortium would decrease the tender price citing the deterioration of current financial markets?

I sometimes watch CNBC World in the evenings and some news that caught my attention were constant reminders from the anchors about Macquiarie’s massive drop in the share price. If that’s the same Macquiarie as the one you are referring to, wouldnt’ that have an effect on the arbitrage?