Help for Seabrook gallops in; A-plant work may resume soon
Boston — The fair Seabrook has a rescuer but, just who, remains a mystery. After weeks of closed-door dickering, the 16 joint-owners have agreed to a plan to save the stalled New Hampshire nuclear power project.
The plan protects the lead owner, Public Service Company of New Hampshire (PSNH), from bankruptcy. A funding package takes the financing pressures off PSNH for the next three years. And a ''sponsor,'' unknown at this writing, has guaranteed that PSNH will meet all interest payments for at least 18 months.
In the next two weeks, in white-knight fashion, Robert Hildreth Jr. of Merrill Lynch will try to secure $75 million to $90 million in short-term loans from banks. Analysts believe he will succeed. Then early this summer, Mr. Hildreth, the architect of the rescue, intends to sell some $200 million to $300 million in bonds to finance long-term debt. With this money in hand, construction will begin again, slowly, on Seabrook I.
Once PSNH is out of danger, ''Newbrook'' will be set up. This new corporate entity is intended to raise the estimated $1 billion needed to finish the 73 percent-complete Seabrook I. Under Newbrook, PSNH would no longer manage construction or operate the plant.
Still, state and federal regulators must approve the reorganized ownership stucture as well as the bond sale, and buyers for the bonds must be found.
Banks and regulators may be encouraged by a favorable report on Seabrook's prospects that was expected to be released late today (Tuesday). Last month, the six New England governors hired a consultant to evaluate the likely cost of completing Seabrook I.
Meanwhile, Wall Street is taking a wait-and-see approach to the rescue plan. ''There are a lot of questions in our minds here,'' says Doug Randall of Standard & Poors investment service. ''Just who is this guarantor?''
Utility analyst Mark Luftig of Salomon Brothers offers these possibilities: one of the labor unions on the project, which may back the plan with its pension fund; the strongest Seabrook partner, New England Electric System; the Raytheon Company, parent company of the project's chief contractor; or Merrill Lynch. Other observers have speculated it could be Bechtel Corporation, which was rumored to be interested in the stalled second unit.
''I have no idea why the sponsor is remaining secret, unless it wants to wait until it's sure a deal is in place,'' says Mr. Luftig.
For several weeks, the sticking point to the Merrill Lynch rescue plan was that the 15 other owners did not want to be responsible for picking up PSNH's tab if it defaulted on its Seabrook payments. The unnamed sponsor eliminated this objection. If PSNH defaults, the sponsor could buy its Seabrook shares cheaply.
The sponsor is expected to be revealed at the end of the week, in order to establish investor confidence in the plan.