20120104Notice of Affiliate Transaction.pdf

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One Utah Center, 23nJ Floor
201 South Main
Salt Lake City, UT 84111
Please Reply To:
Daniel E. Solander, Senior Counsel
l)~ect l)ial [phone]
AM 10: 28 email: daniei.solande~acificor.com2012 JAN -4
Janua 3, 2012 UTI
VI ELECTRONIC FILING
AND OVERNIGHT DELIVERY
Idao Public Utilties Commission
472 West Washington
Boise, il 83702-5983
,
Attention:Jean D. Jewell
Commssion Secreta
Re: PacifiCorp Notice of Affliate Transaction
Case No. PAC-E-05-8
Dear Ms. Jewell:
Ths letter will serve as notice pursuat to Commtment I 17(2), incorporated in the
Idaho Public Utilities Commission Order No. 29973 issued Febru 13,2006, as supplemented
by Order No. 29998 March 14, 2006, in the above-referenced proceeding, approving the
acquisition of PacifiCorp by MidAerican Energy Holdings Company ("MEHC"), of an affliate
interest transaction with Wells Fargo Securties, LLC (Wells Fargo). The Company selected
Wells Fargo to be one of the four joint book ivg managers for a bond offering the Company
intends to issue in the near futue. A copy of the draft Confdential Form of Underwting
Agreement is included as Attchment A. Confdential Attachment A contas commercially-
sensitive inormation and the Company requests that it be treated as confdential and fied under
seal. Ths document conta a "draft" designation, which will be removed upon execution of
the agreement. There are no material changes expected to the terms and conditions of the
agreement.
PacifiCorp is a wholly-owned indirect subsidiar of MidAerican Energy Holdings
Company (MEHC). MEHC is a subsidiar of Berkshie Hathaway, Inc (Berkshie Hathaway).
As of March 31, 2010, Warn E. Buffet (an individua who may be deemed to control Berkshir
Hathaway), Berkshire Hathaway, varous subsidiares of Berkshire Hathaway and varous
employee benefit plan of Berkshie Hathaway subsidiares together held an interest in excess of
5 percent in Wells Fargo common stock, which may constitute an affliate interest in some
PacifiCorp jursdictions.
PacifiCorp intends to issue a bond offerig in the near futue and ha solicited
underwting proposals from a number of bans. Several bans, including Wells Fargo, provided
information on indicative credit spreads, market conditions, their credit analysis, marketing plans
and underwting fees. The Company selected Wells Fargo as one of four joint book rug
managers for ths bond offerig based on the favorable indicative credit spread, knowledge of
the utilty industr, the Company and its operations, abilty to market the bonds to prospective
Idaho Public Utilties Commission
Janua 3, 2012
Page 2
investors, successfu outcomes in prior underwting for the Company, and reasonable
underwting fees. The selection of Wells Fargo was not inuenced by Berkshie Hathaway's
ownership interest. Wells Fargo's underwting fees will be equa to the fees paid to each of the
thee other joint book ruing mangers and at what PacifiCorp believes to be maket rates or
better for the Company. PacifiCorp anticipates Wells Fargo's underwting fee will be
approximately $1,150,000.
As a public utilty, the Company is expected to acquire, constrct, improve, and mainta
sufcient utility facilties to serve its customers adequately and reliably at reasonable cost.
Issuace of bonds are par of a progr to finace the Company's facilties tag into
consideration prudent capita ratios, earng coverage tests and market uncernties as to the
relative merits of the varous tyes of securties the Company could sell. Accordingly, the
transaction is consistent with the public interest.
The transaction listed above was negotiated at ars-lengt as between PacifiCorp and
Wells Fargo. Please call me at the above number or Ted Weston at [phone] if you have
any questions regarding ths filing.
Very Truly Yours,
£~d~(11
Senior Counsel
Enclosures