Air Pollution Control Equipment Services, Coal

Wheelabrator Air Pollution Control Inc. acquired by Aquila Power Services Corp.

HOUSTON, Texas, Aug. 12, 2002 — Aquila Power Services Corp., announced recently the acquisition of Wheelabrator Air Pollution Control Inc.

Wheelabrator designs and supplies air pollution control products for the coal fired utility industry and industrial markets such as steel, cement, waste to energy, petrochemical and others.

The acquisition of Wheelabrator is Aquila’s third acquisition and further enhances Aquila’s strategy to assemble a platform of complementary businesses providing services and equipment to the worldwide power industry and other industrial markets.

Founded in 1913, Wheelabrator (Pittsburgh) engineers, designs and supplies air pollution control products including fabric filter systems, electrostatic precipitators and both wet and dry scrubbing systems. In addition, Wheelabrator provides a broad range of service capabilities including process analysis, system design, erection, start-up and complete aftermarket parts and services.

Joe Compofelice, CEO of Aquila Power Services, stated that “Aquila Power Services is building a balance of service and equipment companies that serve the electricity generation market and certain other industrial markets. Wheelabrator is one of the strongest brand names in the pollution control industry. Wheelabrator’s participation in the coal-fired generation and other industrial markets provides balance and customer diversity with Aquila’s presence in the gas-fired generation equipment market through C&W Fabricators.” With the addition of Wheelabrator, the majority of Aquila’s revenue and earnings are weighted towards the maintenance, repair and retrofit applications in the electricity generation market including coal, nuclear and waste to energy, Compofelice said.

Aquila intends to merge Wheelabrator and C&W into one operating unit to streamline their operations in the equipment area, create cost savings and enable Wheelabrator to take advantage of the engineering and manufacturing expertise of C&W, Compofelice said.

“The advantages of this transaction to Wheelabrator are quite significant,” according to Antonio DoVale, president of Wheelabrator, who will assume responsibility, as president, for the combined equipment operations.

“Aquila Power Services gives us the financial strength and market presence to compete successfully on the larger utility projects. Wheelabrator believes that the air pollution control market will surge in the next few years as utilities strive to meet the sulfur dioxide, nitrogen oxides and heavy metals requirements of the Clean Air Act, President Bush’s Clear Skies Initiative and emerging state and local regulations.”

Wheelabrator is headquartered in Pittsburgh, as will be the combined equipment operations group. For the three years ended Dec. 31, 2001, Wheelabrator has had average annual revenues of approximately $130 million.

About Aquila Power Services Corp.

First Reserve Corporation recently formed Aquila Power Services Corporation (Houston) to capitalize on the projected growth for services and equipment in the power and other industries, both domestically and internationally. Aquila is assembling a platform of complementary companies providing services and equipment to the worldwide power industry.

To date, Aquila has acquired C&W Fabricators Inc. (a supplier of engineered components to combustion turbine manufacturers), Welding Services Inc. (a specialty mechanical maintenance contractor) and Wheelabrator Air Pollution Control Inc. Aquila’s equity investors include First Reserve, Duke Capital, CIBC Capital and Abbott Capital.
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About First Reserve Corp.

First Reserve Corp. (Greenwich, Conn.) is a private equity firm specializing in the energy industry, with $2.5 billion under management. Founded in 1980, First Reserve was the first private equity investment firm to actively pursue building a broadly diversified investment portfolio within the energy industry.

First Reserve is currently or was previously the largest shareholder of Chicago Bridge & Iron, Pride International, National Oilwell, Weatherford International, Maverick Tube Corporation, Cal Dive, and Superior Energy Services.