Topeka The price of stock in Western Resources Inc. and potential suitor Public Service Co. of New Mexico fell sharply Monday, the first day of trading since state utility regulators rejected Western's plan to split into two companies.
Officials from both companies declined comment on the decision by the Kansas Corporation Commission, saying they would wait until the KCC rules on Western's request for a $151 million rate increase. That decision is expected Wednesday.
Western stock opened Monday at $21.70 per share and closed at $18.91, a decrease of 12.86 percent.
Meanwhile, Albuquerque-based PNM denied reports that it was backing out of the proposal to buy Western's KPL and KGE electric utilities. Both companies trade on the New York Stock Exchange.
PNM continues to believe in the strategic benefits of the planned acquisition, said PNM executive vice president Bill Real, who is in charge of administering the acquisition.
PNM, which serves 1.3 million customers in New Mexico and sells wholesale power to the western United States, opened at $28.74 per share and closed at $28, a loss of 2.57 percent.
Real also declined comment on the KCC's order in Western's restructuring plan until after the rate case was decided.
Friday, the KCC stopped Western's attempt to split into two companies one for its electric utilities regulated by the KCC and another with unregulated companies.
The KCC ruled that the deal would allow debt from the unregulated companies to be transferred to the utilities, where ratepayers would have to pay it off.
Kim Gronniger, a spokeswoman for Western, declined to comment on the KCC decision. "We're still reviewing the 42-page order from Friday and awaiting the rate case order that is expected on Wednesday," she said.
"We hope that future joint filings with PNM will demonstrate how the issues raised in Friday's order can be addressed. Until after the rate case decision, and we have had an opportunity to review both decisions, we really won't be able to comment more fully."
Under Western's proposed increase, rates for customers of KPL, which serves Lawrence and much of northeast Kansas, would increase about 20 percent.