8-KMaterial AgreementsExhibits & Filings

CMS ENERGY CORP 8-K Report, Material Agreement (Feb 14, 2007)

Filed February 14, 2007For Securities:CMSCMS-PCCMSACMSCCMSD

Summary

CMS Energy Corporation (CMS) has filed an 8-K report detailing a significant development in its international operations. On February 13, 2007, the company entered into a Memorandum of Understanding (MOU) with Petroleos de Venezuela, S.A. (PDVSA), an entity owned by the Venezuelan government, for the sale of its interest in Sistema Electrico de Nueva Esparta, C.A. (SENECA). This transaction, valued at $105.5 million, includes CMS Energy's 88 percent stake in SENECA, associated generating equipment, and other related assets. The proposed sale is a strategic move for CMS Energy, signaling a divestiture from its Venezuelan operations. The agreement is subject to the negotiation and execution of a definitive purchase and sale agreement, with an expected closing date by March 31, 2007. Investors should note that this transaction is subject to standard representations, warranties, and indemnities, as well as legal and financial due diligence by PDVSA. The CMS Energy Board of Directors has approved the execution of this MOU.

Key Highlights

  • 1CMS Energy signed a Memorandum of Understanding (MOU) on February 13, 2007, to sell its interest in Sistema Electrico de Nueva Esparta, C.A. (SENECA).
  • 2The buyer is Petroleos de Venezuela, S.A. (PDVSA), a Venezuelan state-owned oil company.
  • 3The sale price for CMS Energy's 88 percent stake in SENECA, including associated assets, is $105.5 million.
  • 4The transaction is expected to close by March 31, 2007, pending a definitive purchase agreement.
  • 5The MOU includes standard representations, warranties, indemnities, and requires PDVSA to perform due diligence.
  • 6CMS Energy's Board of Directors has approved the execution of the MOU.
  • 7This filing indicates a divestiture of CMS Energy's Venezuelan operations.

Frequently Asked Questions

The main purpose of this 8-K filing is to report CMS Energy Corporation's entry into a material definitive agreement concerning the sale of its interest in Sistema Electrico de Nueva Esparta, C.A. (SENECA) to Petroleos de Venezuela, S.A. (PDVSA).

The proposed sale of CMS Energy's 88 percent stake in SENECA, along with associated assets, is valued at $105.5 million.

The sale is expected to close by March 31, 2007, subject to the negotiation and execution of a definitive purchase and sale agreement and satisfactory due diligence by PDVSA.

Yes, the agreement is subject to the negotiation of a definitive purchase and sale agreement which will include standard representations, warranties, indemnities, and PDVSA's completion of legal and financial due diligence. The CMS Energy Board of Directors has approved the MOU.