Pacificorp Loses Bet On Exchange Rates

PacifiCorp says it will take a $65 million charge in the third quarter despite efforts to protect itself from currency exchange rates in a $9.7 billion purchase of Energy Group PLC, a British utility.

PacifiCorp bought options on 1.45 billion pounds at an exchange rate of $1.64 when it announced the deal in June, but the exchange rate between the dollar and the pound fell to $1.58 when the Portland-based utility closed the deal.

The company lost about $56 million on the exchange rate, and already had incurred a cost of $9 million on the initial options.