As of last Monday, any power company contiguous with SCANA’s electric power distribution area can offer to take over SCANA. President Bush signed the 1,700–page energy bill Monday in New Mexico, and his signature repealed the 1935 Public Utilities Holding Company Act, or PUHCA.

Prior to PUHCA any power company wanting to expand could buy adjacent competitors. SCANA’s forerunner expanded in Columbia and bought into Charleston during this period. Much larger power companies across the country expanded rapidly. In Chicago, for instance, Samuel Insull expanded his Middle West Utilities through the mid–20s to cover 32 states and to generate one eighth of America’s electric power. In the summer of 1929, Insull’s companies’ market value was rising at the rate of $7,000 a minute.

The Great Crash hit Wall Street on October 29, 1929, and Insull was on the cover of Time Magazine the next week as a symbol of business strength and stability. On September 14, 1932, an audit disclosed corporate deficits no one expected to see, and Insull’s investors lost almost a quarter of a billion dollars soon thereafter.

To protect Americans against a repeat of Insull’s performance, Congress passed PUHCA, denying electric power company expansion through acquisition of adjacent power companies. PUHCA came along several years after SCANA’s forerunner Broad River Power Company took over Columbia Railway, Gas and Electric Company.

The acquisition of its in–town competitor also gave Broad River the responsibility to run the Columbia transit system for the life of the city and the life of the company. The US Supreme Court had to confirm that obligation for posterity in 1931, setting up a somewhat adversarial relationship between SC’s capital city and its utility monopoly.

Should SCANA resist?

Why should it? Its shareholders will come out more than just all right. Shareholders in Reebok are seeing a 38% premium this week in the price Adidas is willing to pay to take over Reebok. At a premium per share 38% more than the current trading price per share, Reebok’s stock owners are doing fine. SCANA’s shareholders should imagine at least a 20% premium when one of their oversized neighbors comes calling.

That’s the good news. The bad news is the SCANA corporate headquarters population on Main Street, originally filling 17 floors of the Palmetto Center, is likely to move out.

SCANA’s timing

SCANA leaders have a great sense of timing. They got rid of the bus system a few years ago, and they put their continued subsidies on a fixed schedule – soon to end. They built the dam according to federal requirements, and they called completion of the $275 million construction project – soon to end. They signed a master lease for 25 years’ occupancy on 17 floors in their Palmetto Center headquarters – soon to end. Congress and the White House lowered barriers to the approaches from Duke, Southern, Progress Energy, all coming hard onto SCANA – soon to end.