Edison Mission Group Announces Tender Offer and Consent Solicitation by its Edison Mission Energy Unit

May 8, 2006

On May 5, 2006, Edison Mission Group (EMG) announced that its indirect subsidiary, Edison Mission Energy (EME) has commenced a cash tender offer and consent solicitation for all $400,000,000 of its outstanding 10% Senior Notes due August 15, 2008 (the "2008 Notes” – CUSIP No. 281023AK7) and all $600,000,000 of its outstanding 9.875% Senior Notes due April 15, 2011 (the "2011 Notes"—CUSIP No. 281023AG6) (the "Notes").

The tender offer will expire at 5:00 p.m., New York City time, on June 5, 2006, unless extended (the "Expiration Date").  Under the terms of the tender offer and consent solicitation, holders of the Notes who validly tender and do not validly withdraw their Notes and consents prior to 5:00 p.m., New York City time, on May 17, 2006, (the "Consent Date") will receive the Total Consideration, which is equal to the Tender Consideration (as described below) plus an amount equal to $30.00 per $1,000 principal amount of Notes (the "Consent Payment").  The Tender Consideration is equal to (i) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes, discounted to maturity on a semi-annual basis at the applicable treasury yield (calculated on the Price Determination Date) plus 75 basis points, minus (ii) accrued and unpaid interest to, but not including, the Payment Date (which will promptly follow the Expiration Date), minus (iii) the Consent Payment.  Holders of the Notes who validly tender their Notes and consents after the Consent Date and prior to the Expiration Date will only receive the Tender Consideration. No Consent Payments will be made in respect of Notes tendered and consents delivered after the Consent Date.  In both cases, holders whose Notes are purchased in the tender offer and consent solicitation will also be paid accrued and unpaid interest from the most recent interest payment date on the Notes to, but not including, the Payment Date.  Holders may not tender their Notes without delivering their consents, and may not deliver their consents without tendering their Notes.

The Price Determination Date will be May 19, 2006, the tenth business day immediately preceding the Expiration Date, as described below, unless EME extends the tender offer as permitted in the Tender Offer and Consent Solicitation Statement, dated May 5, 2006 (the "Statement").

As part of the tender offer and consent solicitation, EME is soliciting consents from registered holders of the Notes to certain proposed amendments to the indentures pursuant to which the Notes were issued, in each case to eliminate substantially all the restrictive covenants, eliminate or modify certain events of default and eliminate or modify related provisions contained in each indenture.  These proposed amendments include amendments necessary to permit EME to increase the size of its secured corporate credit facility.  EME intends to replace its existing $98 million secured corporate credit facility with a new secured corporate credit facility providing for $500 million in revolving loan and letter of credit capacity to be used to repay existing debt and/or to provide liquidity and credit support for the hedging and trading activities of EME and its subsidiaries.

Notes tendered prior to the Consent Date may not be withdrawn, and consents delivered prior to the Consent Date may not be revoked, after the Consent Date, except in the limited circumstances described in the Statement. Notes tendered and consents delivered after the Consent Date and prior to the Expiration Date may not be withdrawn or revoked, except in the limited circumstances described in the Statement.

The tender offer and consent solicitation are subject to the satisfaction of certain conditions, including the receipt of consents from the holders of not less than a majority of the then-outstanding aggregate principal amount of each issuance of the Notes and the consummation by EME of one or more new debt financings on terms satisfactory to EME in an aggregate amount not less than $1.0 billion. No assurance can be given that such new financings will be completed in a timely manner or at all.

The complete terms and conditions of the tender offer and consent solicitation are described in the Statement, copies of which may be obtained by contacting D.F. King & Co., Inc., the information agent for the tender offer and consent solicitation, at (212) 269-5550 or (800) 859-8511 (toll free). Questions regarding the tender offer and consent solicitation may be directed to the Dealer Managers for the tender offer and consent solicitation: J.P. Morgan Securities Inc., which may be contacted at (212) 270-3994 or (800) 245-8812 (toll free) and Citigroup Corporate and Investment Banking, which may be contacted at (212) 723-6106 or (800) 558-3745 (toll free). 

This announcement is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of consents with respect to any securities. The tender offer and consent solicitation is being made solely by the Statement.

EME is an independent power producer that is engaged in the business of owning or leasing, operating and selling energy and capacity from electric power generation facilities. EME’s power generation portfolio consists of owned and leased interests in 20 operating power plants with an aggregate net physical capacity of 10,214 megawatts, of which EME's pro rata share was 9,098 megawatts as of December 31, 2005.  EME is a subsidiary of EMG, which is the parent company of the unregulated subsidiaries of Rosemead, California-based Edison International (NYSE:EIX), an electric power generator and distributor, and an investor in infrastructure and renewable energy projects with assets totaling more than $34.6 billion.

This release includes forward-looking statements.  EME has based these forward-looking statements on its current expectations and projections about future events based upon knowledge of facts as of the date of this press release and its assumptions about future events. These forward-looking statements are subject to various risks and uncertainties that may be outside EME’s control. EME has no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This press release should be read in conjunction with EME’s Annual Report on Form 10-K, Amendment No. 1 to Annual Report on Form 10-K/A and Quarterly Report on Form 10-Q filed this calendar year.

Edison Mission Group Announces Tender Offer and Consent Solicitation by its Edison Mission Energy Unit

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