Federal Agency Questions Investment in Nevada Utility

CARSON CITY, Nev. (AP) - A federal agency is questioning Horizon
Asset Management of New York about the company's $3 billion investment in several big electric utilities, including $756 million in shares of Nevada-based Sierra Pacific Resources.

The state Public Utilities Commission already is reviewing Horizon Asset's purchases to determine whether the investment company and an affiliate should have obtained commission approval before acquiring more than 25 percent of Sierra Pacific.

The PUC is aware of the latest move by the Federal Energy Regulatory Commission, and is awaiting final responses from Sierra Pacific to the PUC's own data requests, a commission spokesman said Wednesday.

The federal agency, trying to determine whether Horizon Asset failed to get approval for its large ownership stakes in energy companies, sent an inquiry Tuesday to Andrew Fishman, Horizon Asset's chief compliance officer.

Fishman didn't return a call Wednesday seeking comment. Andrea Smith, a spokeswoman for Sierra Pacific Resources, declined comment. Sierra Pacific Resources is the parent company of Nevada
Power Co. of Las Vegas and Sierra Pacific Power Co. of Reno.

The FERC inquiry also says Horizon Asset owns more than $1 billion worth of shares in Reliant Energy of Houston, which is more than 10 percent of Reliant's outstanding shares. Reliant spokeswoman Pat Hammond said she couldn't comment immediately on the FERC letter but believed company officials were studying it.

Large Horizon Asset stock holdings in several other utilities also are listed in the FERC letter.

State consumer advocate Eric Witkoski said he's concerned about the Sierra Pacific Resources stock purchases because a little-known company like Horizon Asset now controls such a large percentage of
Sierra shares.

"It's even more of a concern when there are entities out there that own lots of energy companies," Witkoski said.

Former Nevada consumer advocate Tim Hay said Horizon Asset may
have acquired Sierra Pacific shares thinking a future merger would
run up the stock value. He added there are periodic rumors that the
Nevada utility may be targeted for a merger or acquisition offer.

Charles Benjamin, director of the Nevada office of Western Resource Advocates, said Horizon Asset and an affiliated company called Kinetics Asset Management hold more than a quarter of Sierra shares.

Hay has calculated that Horizon and Kinetics own 29 percent of Sierra Pacific Resources shares. He said Horizon and Kinetics are affiliated because they have the same senior staff, same compliance officer and same office in New York.

(Copyright 2008 by The Associated Press. All Rights Reserved.)