Business Context and Reporting Period
This Form 8-K Current Report was filed by DTE Energy Company and The Detroit Edison Company on April 29, 2009. The filing reports on corporate actions taken on that date regarding the restructuring of short-term credit facilities for The Detroit Edison Company.
Key Financial Metrics
- New Credit Facility: A two-year unsecured revolving credit agreement with an aggregate availability of approximately $211 million.
- Current Borrowings: $0 (No borrowings under the new facility at the time of filing).
- Interest Rate: Borrowings available at prevailing short-term interest rates.
- Covenant Requirement: Maintenance of a debt to capitalization ratio of no more than 0.65 to 1.
- Facility Expiration: April 2011.
Material Changes Versus Prior Period
On April 29, 2009, The Detroit Edison Company terminated its previous Second Amended and Restated Five-Year Credit Agreement dated October 17, 2005. This prior facility was replaced entirely by the new two-year agreement described above. The filing does not provide comparative financial performance data (revenue, profit, or cash flow) as this is a report on a specific material agreement rather than a periodic financial statement.
Outlook, Risks, and Management Commentary
The new facility is designed to support Detroit Edison's commercial paper borrowings. The primary financial constraint imposed by the new agreement is the maintenance of the specified debt-to-capitalization ratio. The filing does not contain forward-looking guidance on earnings or broader market risks beyond the terms of the credit agreement.
Key Facts for Investor Verification
- Verify the current debt-to-capitalization ratio to ensure compliance with the new 0.65 to 1 covenant.
- Confirm the utilization status of the $211 million revolving credit facility.
- Review the terms of the terminated 2005 credit agreement to understand the full scope of the refinancing.
- Monitor the expiration date of April 2011 for potential refinancing needs.