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U.S. Securities and Exchange Commission


(Release No. 35-27848; 70-10207)

Alliant Energy Corporation

Order Authorizing Amendment of Articles of Incorporation

May 25, 2004

Alliant Energy Corporation ("Alliant Energy"), a registered holding company, Madison, Wisconsin has filed with the Securities and Exchange Commission ("Commission") a declaration ("Declaration") under sections 6(a), 7, and 12(e) of the Public Utility Holding Company Act of 1935, as amended ("Act") and rules 54, 62, and 65 under the Act. On March 31, 2004, the Commission issued a notice of the Declaration and authorized Alliant to solicit shareholder consents relating to its request, discussed below (Holding Co. Act Release No. 27826).

Alliant Energy requests authority to amend its Restated Articles of Incorporation, as amended ("Restated Articles") to increase the number of authorized shares of common stock that it may issue from 200,000,000 to 240,000,000. Currently, there are only 18,704,700 authorized shares of Alliant Energy available for issuance for future business purposes.1 As of March 31, 2004, Alliant Energy's consolidated capitalization consisted of: 47.8% common equity, 4.9% preferred stock, 43.1% long-term debt (including variable rate demand bonds classified as current), and 4.2% short-term debt (including current maturities of long-term debt). At its annual shareholders' meeting ("Annual Meeting") on May 21, 2004, Alliant Energy received the necessary approval from its shareholders.

Alliant Energy anticipates that it will require in the future a greater number of authorized shares of common stock than is currently available under its Restated Articles to issue new equity to fund its capital expenditure program, including its recently announced domestic regulated generation build-out program. By this Declaration, Alliant Energy is not requesting any new or additional financing authority.

The proposed transaction is subject to rule 54 under the Act. Rule 54 provides that, in determining whether to approve any transaction that does not relate to an "exempt wholesale generator" ("EWG") or "foreign utility company" ("FUCO"), as defined in sections 32 and 33, respectively, the Commission shall not consider the effect of the capitalization or earnings of any subsidiary which is an EWG or FUCO upon the registered holding company system if paragraphs (a), (b) and (c) of rule 53 are satisfied.

Currently, Alliant Energy does not meet all of the conditions of rule 53(a). As of March 31, 2004, Alliant Energy's "aggregate investment," as defined in rule 53(a)(1), in EWGs and FUCOs was approximately $518.3 million, or approximately 63.8% of Alliant Energy's average "consolidated retained earnings," also as defined in rule 53(a)(1), for the four quarters ended March 31, 2004 ($812.6 million). Although this exceeds the 50% "safe harbor" limitation contained in rule 53(a), it is within the investment limit previously authorized by the Commission. See Holding Company Act Release No. 27448 (October 3, 2001) ("EWG/FUCO Order") (authorizing Alliant Energy to increase its "aggregate investment" in EWGs and FUCOs to an amount equal to 100% of its average consolidated retained earnings). Alliant Energy satisfies all of the other conditions of paragraphs (a) and (b) of rule 53, and none of the adverse conditions specified in rule 53(b) exist.

Since September 30, 2001, the end of the quarterly period immediately preceding the issuance of the EWG/FUCO Order, Alliant Energy has experienced an increase in consolidated common stock equity.2 Alliant Energy states that the proposed transactions will have no impact on its consolidated capitalization.

With regard to earnings attributable to its investments in EWGs and FUCOs, Alliant has experienced losses from its portfolio of FUCOs in calendar years 2000, 2001 2002, and 2003 ($17.7 million, $25.3 million, and $26.7 million, respectively). The company's losses on its Brazil investments were unexpectedly large in 2002, resulting primarily from the impact of a decline in currency translation rates, as well as from charges related to recovery of the impacts of electricity rationing in Brazil and other prior costs. Since then, energy demand has increased and several rate increases have been approved. In fiscal year 2003, Alliant Energy's FUCO investments generated approximately $3.8 million in income (not including gain from sale of Australian FUCO investments).

The fees, commissions and expenses incurred or to be incurred by Alliant Energy in connection with the proposed transactions, including the Proxy Solicitation, are estimated not to exceed $21,000. No state commission, and no federal commission, other than this Commission, has jurisdiction over the proposal.

Due notice of the filing of the Declaration has been given in the manner prescribed in rule 23 under the Act, and no hearing has been requested of or ordered by the Commission. On the basis of the facts in the record, it is found that the applicable standards of the Act and the rules under the Act are satisfied, and that no adverse findings are necessary.

IT IS ORDERED, under the applicable provisions of the Act and rules under the Act, that the Declaration is permitted to become effective immediately, subject to the terms and conditions contained in rule 24 under the Act.

For the Commission, by the Division of Investment Management, pursuant to delegated authority.

Margaret H. McFarland
Deputy Secretary



Modified: 06/02/2004