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15 September 2006 -- Dynegy Inc., based in Houston, Texas, US, and LS Power Group, a privately held power plant investor, developer and manager, today announced that the companies have executed a definitive agreement to combine Dynegy's current assets and operations with LS Power Group's generation portfolio, and for Dynegy to acquire a 50 percent ownership interest in a development joint venture with LS Power.
Dynegy Chairman and CEO Bruce A. Williamson and the rest of Dynegy's executive management will lead the combined company and it will retain the Dynegy Inc. name and remain headquartered in Houston.
Under the terms of the transaction, LS Power will receive 340 million shares of Dynegy common stock plus $100 million in cash and a $275 million Dynegy Inc. note. The combined entity will also assume approximately $1.8 billion in net debt from LS Power.
The transaction will create a combined company with more than 20,000 MW comprised of 31 power plants in 15 states. In addition to expanding the companies into three geographic regions, Dynegy will benefit from a diversification of its generation mix, adding intermediate combined-cycle capacity to an existing portfolio that largely consists of baseload and peaking assets. The company's expanded portfolio will also include a controlling interest in the Plum Point facility in Arkansas, the only coal-fired plant in the country currently under construction by an independent power producer.
The development joint venture will provide Dynegy with a 50 percent ownership interest in an established growth vehicle. The joint venture will immediately own a pipeline of nine greenfield projects totaling more than 7,600 MW in various stages of development and approximately 2,300 MW of repowering opportunities.
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