Texas Utilities serves about 40,000 customers in the same area.

Texas Utilities, whose entry into the battle had been expected, said yesterday that it was considering whether to increase its offer.

In the 1990s, cheap natural gas replaced coal as the favorite choice of Texas utilities.

Texas Utilities jumped 1 3/8, to 36, on traders' expectations of improved financial performance.

Texas Utilities was the busiest issue, falling 5/8, to 28 1/4, on a volume of nearly 4.8 million shares.

Texas Utilities has already made big cuts in employment, reducing its staff to 10,000 from 15,000 in 1992.

Texas Utilities said it would contribute about $500 million to $600 million in cash to the price, while the rest will come from debt.

For instance, last year, Texas Utilities reported more than $1 billion in profits to shareholders.

Yesterday, Texas Utilities raised its offer to $:8.40, or $13.86.

Texas Utilities, with an annual dividend yield now of 8.31 percent, rose 1/4, to 35 7/8, on 1.9 million shares.