Indiana Energy, Citizens Gas & Coke and SIGCORP sign letter of intent to form an energy management alliance

Business Wire, May 27, 1997

INDIANAPOLIS--(BUSINESS WIRE)--May 27, 1997--Indiana Energy Inc., the holding company of Indiana Gas Company Inc., Citizens By-Products Coal Co., the unregulated subsidiary of Citizens Gas & Coke Utility, and SIGCORP, the holding company of Southern Indiana Gas and Electric Co., have agreed to form a jointly owned entity for the purpose of providing comprehensive energy management solutions through performance contracting.

The new entity, Energy Systems Group, LLC (ESG), will provide a total package of products, services and skills to help energy users achieve enhanced energy and operational performance. The packages will provide for improvements to be paid for from each savings generated within existing operating budgets. ESG will assume the responsibilities of Energy Systems Group Inc., an energy related performance contracting firm of SIGCORP. The new entity will begin operations sometime this summer with offices in Indianapolis and Evansville.

Indiana Gas provides natural gas and related services to about 470,000 residential, commercial and industrial customers in 48 of Indiana's 92 counties. Citizens Gas serves about 250,000 natural gas customers in Marion County. Southern Indiana Gas and Electric Co. serves more than 122,000 electric customers and 106,000 natural gas customers in 10 southwestern Indiana counties.

The companies do not intend to issue further news releases regarding this transaction until after the execution of a definitive agreement.

CONTACT: Indiana Energy Inc., Indianapolis

Jeffery W. Whiteside, 317/321-0588

Fax: 317/921-2767

jwhiteside@indiana-energy.com