NEW YORK, Aug 14, 2000 /PRNewswire via COMTEX/ -- Sithe Energies, Inc. announced today that it has entered into a definitive agreement with PECO Energy Company (NYSE: PE) under which PECO will acquire 49.9% of Sithe North America. Upon completion of the agreement, the remaining 50.1% of Sithe North America will be owned by Vivendi (33%), Marubeni Corp. (15%) and Sithe management (2%). Under the terms of the agreement, two to five years after closing, PECO can purchase the remaining 50.1% of Sithe North America at a price subject to certain market conditions.

William Kriegel will continue to serve as chairman and chief executive officer of Sithe and the Company will continue to be headquartered in New York City. The transaction is conditioned upon the satisfaction of customary conditions and is expected to close by October 2000.

William Kriegel, chairman and chief executive officer of Sithe, said, "When I founded Sithe more than fifteen years ago, I saw there was an increasing need for electric generation capacity in the U.S. and throughout the world. Today's announcement demonstrates the validity of our strategy. Sithe has assembled one of the largest portfolios of environmentally-friendly, non-nuclear power generating facilities and has distinguished itself as a leader in energy development. All of us at Sithe are proud that together, we have delivered significant value to our shareholders. I am confident that Sithe and its employees will benefit from working closely with PECO, one of the country's leading energy companies."

Corbin McNeill, Jr., chairman, president and chief executive officer of PECO Energy, said, "This transaction gives us the opportunity to join with one of the country's leading merchant power developers operating a quality fleet of assets in robust, unregulated power markets. Our generating focus has moved beyond nuclear generating capability and unit-by-unit acquisitions. Also, we will be acquiring an extensive electric and natural gas trading presence in the New England and New York power pools, complementing our already strong Midwest and mid-Atlantic positions. Additionally, the transaction will give us one of the strongest generation development capabilities in the world."

"Deregulation of the energy industry and the introduction of new technologies, particularly the Internet, have created unique opportunities for investors with the right experience and resources. With kRoad Ventures, we will bring our collective resources, experience and vision to emerging companies in the infrastructure industries and capitalize on the enormous opportunities available," concluded Mr. Kriegel, who also serves as chairman of kRoad Ventures L.P.

kRoad Ventures L.P. (kRoad) is a global venture capital fund based in New York City that invests in and counsels early stage (first and second round) Internet and technology-driven ventures in the infrastructure sector (energy, utilities, water, telecommunications and waste-management). kRoad partners include William Kriegel, Sithe, Vivendi and Softbank.

PECO Energy Company is an electric and gas utility with 6,500 employees serving 1.5 million electric costumers in the five-county Philadelphia region and more the 425,000 natural gas customers. It has aggressively forged into the deregulation marketplace, trading wholesale power establishing unregulated ventures in retail energy sales, telecommunications and utility infrastructure management. PECO Energy has set new nuclear performance standards in safety, capacity factors, refueling efficiency and low operating and maintenance costs, while producing more than 36 billion kilowatt-hours of nuclear electricity in 19999. PECO Energy also owns and operates coal, natural gas, oil, landfill gas and hydro generating plants.

Sithe Energies, Inc., founded in 1984 and headquartered in New York City, has an extensive portfolio of projects in operation, under construction, or in active development. Sithe North America owns and operates 27 power generation facilities with approximately 3,800 MW of net generating capacity in North America and currently has under development 11 facilities with an estimated 2,500 MW of capacity.

SOURCE Sithe Energies, Inc.

CONTACT:          Dan Katcher or Eden Abrahams, both of Joele Frank, Wilkinson

                  Brimmer Katcher, 212-355-4449, for Sithe Energies, Inc.

URL:              http://www.sithe.com

http://www.prnewswire.com

(C) 2000 PR Newswire.  All rights reserved.

KEYWORD:          New York

                  Pennsylvania

INDUSTRY KEYWORD: OIL

                  UTI

SUBJECT CODE:     TNM

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