Newspaper article The Christian Science Monitor

Mergers May Bring Services for Home in Single Package

Newspaper article The Christian Science Monitor

Mergers May Bring Services for Home in Single Package

Article excerpt

All it the debut of one-stop griping.

Consumers exasperated with their local utilities and other home services - including telephone and cable TV - might soon be able to fire all their complaints at a single target.

Deregulation of the gas and electricity industries is sparking mergers between utilities and companies in other sectors eager to expand their customer base and cut billing, marketing, and other costs. Before long, a typical consumer might peruse a single monthly bill itemizing charges for water, gas, electricity, telephone, cable TV, and home security services. It is hoped the mergers and stepped-up competition under deregulation will help cut both the number of service snafus and the total average bill. For instance, price wars among electricity producers could reduce costs for the average household by 10 percent or more, industry analysts say. Electricity, gas, and water utilities across the country have announced 20 mergers in the past 18 months, according to A.G. Edwards & Sons, a brokerage house based in St. Louis. "There'll be more of these mergers if the same forces of deregulation keep going on," says Eugene Abraham, chief executive officer at Sargent & Lundy, an engineering firm in Chicago. "Electric utilities especially want to gain customers and secure their own customer base in preparation for deregulation," says Tim Winter, a securities analyst at A.G. Edwards. Many companies are girding for the loss of their monopoly by merging with firms in the same industry or by staging cross-industry tie ups: electricity with gas or electricity with water. This week Long Island Lighting Company (Lilco) and Brooklyn Union Gas Company announced a merger through a $3 billion stock swap. Brooklyn Union brings to the match 1.1 million customers in three of New York City's outer boroughs. Lilco's 1.1 million electricity customers are on Long Island. The combination would yield total revenue of $4.5 billion. In another recent variation, NIPSCO Industries Inc., a provider of gas and electricity to Northwest Indiana, announced a merger with IWC Resources Corp. …

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