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Utility offers voluntary retirement package to some workers
ST. LOUIS -- Ameren Corp., the parent company of Missouri's largest electric utility, said Monday it will offer voluntary retirement packages to about 1,000 of its 7,400 employees, or roughly 14 percent of its work force.
The St. Louis-based company also said it would modify certain retiree medical benefit plans, resulting in caps on costs to the company and increased retiree co-payments, and freeze wage increases beginning next year for all Ameren management workers.
Ameren expects a one-time, fourth-quarter charge of $30 million to $50 million, based on voluntary retirements of 300 to 500 employees. Ameren said it also may consider involuntary job cuts and other, unspecified ways to pare staffing over the next year to trim costs and bolster efficiency.
"We have a tradition of being a low-cost leader in our industry and expect these actions to help us continue to address the challenges of the future facing us and our industry," Charles Mueller, Ameren's chairman and chief executive, said in a statement.
Workers eligible for the voluntary retirement program include Ameren management employees and members of the International Brotherhood of Electrical Workers Local 1455.
Eligible employees must be at least 50 years old, be regular full-time employees and have been with the company at least 10 years. Employees in the company's AmerenUE, AmerenCIPS, Ameren Services, AmerenEnergy Generating Co. and certain other subsidiaries are eligible for the program. Affected employees have until Dec. 20 to decide whether to accept the deal, with those taking the package expected to leave Ameren early next year.
Ameren last month said that in 2003 and beyond it expects various industry challenges, and "as we move toward completion of our 2003 budget process we will continue to seek opportunities and proactively take steps to help address these challenges," Gary Rainwater, Ameren's president and chief operating officer, said Monday.
Ameren Corp's AmerenUE serves about 1.2 million electric customers in 66 Missouri counties, largely in the St. Louis area and the eastern half of the state, although it also has some pockets in western Missouri.
In trading on the New York Stock Exchange, Ameren shares rose 85 cents, or 2.1 percent, to close Monday at $41.35.
Rainwater on Monday said Ameren's moves would not affect the company's commitments over its Missouri electric rate case settlement or its proposed acquisition of CILCORP Inc. from The AES Corporation. CILCORP is the corporate parent of Peoria, Ill.-based Central Illinois Light Co.
In July, Missouri regulators approved a $400 million settlement with AmerenUE that could eventually save the utility's customers several dollars a month. That deal, which provides for both rate reductions and consumer benefits over four years, followed months of negotiations after a state Public Service Commission complaint that AmerenUE's rates were unreasonable and should be reduced.
The settlement contains about half of the rate reductions and benefits originally sought by the PSC staff, but more than three times what AmerenUE officials had offered about two months earlier.
Ameren announced plans in April to buy CILCORP Inc. for $541 million and assume $859 million in that company's debt. If approved by regulators, that deal will make Ameren the second-largest electrical utility in Illinois.
Ameren said Monday it expects to provide 2003 earnings guidance by this year's end, as well as to offer additional detail on the expected net savings related to the voluntary retirement program and the benefit-plan changes.
Ameren serves 1.5 million electric customers and 300,000 natural gas customers in a 44,500-square-mile area of Missouri and Illinois.
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