NRG Energy Inc. Enters into Agreements to Sell Two Generating Plants for $138 Million
December 01 2015 - 5:00PM
Business Wire
As part of its asset rebalancing program, NRG Energy, Inc.
(NYSE:NRG) has agreed to sell two of its generating stations: the
525 MW Seward power plant in New Florence, Pennsylvania and the 352
MW Shelby County power plant in Neoga, Illinois.
“NRG is focused on maintaining a robust presence and balance
through conventional generation assets that complement each other
in respect to geography, technology and smart fuel diversity,” said
David Crane, CEO NRG. “By streamlining our fleet, we can create
additional value for our shareholders and meet the needs of our
customers with reliable, efficient and economic power. This is part
of our ongoing and deliberate strategy of portfolio
optimization.”
The Seward facility, which is located in the PJM
Interconnection, is being acquired by Seward Generation, LLC, a
Robindale Energy Services, Inc. company. As part of the sale
agreement, NRG Energy Services will provide operations and
maintenance services to the Seward plant on behalf of Robindale
Energy using the current NRG workforce.
The Shelby County facility, which is located in the MISO
Interconnection, is being acquired by an affiliate of Rockland
Capital, LLC. The station is a 352 MW natural gas-fueled,
simple-cycle combustion turbine peaking plant with eight General
Electric LM6000 aero-derivative combustion units.
“Operating a diverse generation fleet is a key component of
NRG’s continued success in every region in which we operate,” said
Mauricio Gutierrez, COO NRG. “As part of our asset optimization
initiative, we’ve identified a few specific facilities that would
be better suited in other hands in markets where we can transact at
good value while avoiding future capital expenditures.”
The aggregate purchase price for the two generation facilities,
both of which are owned by GenOn Energy Inc, an excluded project
subsidiary of NRG, is approximately $138 million comprised of cash
and other consideration. Together, these assets were projected to
average $10.5 million of Adjusted EBITDA annually over the next 3
years and require approximately $17 million in maintenance capital
expenditures over the same period1. The transactions are expected
to close in the first quarter of 2016, subject to regulatory
approvals, including the Federal Energy Regulatory Commission.
Table 1: Adjusted EBITDA
($ in millions)
2016-2018
Average
Income before Income Taxes $ (2.7)
Depreciation and Amortization 13.2
Adjusted EBITDA
$ 10.5
About NRG
NRG is leading a customer-driven change in the U.S. energy
industry by delivering cleaner and smarter energy choices, while
building on the strength of the nation’s largest and most diverse
competitive power portfolio. A Fortune 200 company, we create value
through reliable and efficient conventional generation while
driving innovation in solar and renewable power, electric vehicle
ecosystems, carbon capture technology and customer-centric energy
solutions. Our retail electricity providers serve almost 3 million
residential and commercial customers throughout the country. More
information is available at www.nrg.com. Connect with NRG Energy on
Facebook and follow us on Twitter @nrgenergy.
NRG Safe Harbor Disclosure
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Such forward-looking
statements are subject to certain risks, uncertainties and
assumptions and include NRG’s expectations regarding asset sales
and forward-looking statements typically can be identified by the
use of words such as “will,” “expect,” “believe,” and similar
terms. Although NRG believes that its expectations are reasonable,
it can give no assurance that these expectations will prove to have
been correct, and actual results may vary materially. Factors that
could cause actual results to differ materially from those
contemplated above include, among others, general economic
conditions, hazards customary in the power industry, failure of
counterparties to perform under contracts and our ability to
receive regulatory approvals. NRG undertakes no obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. The
foregoing review of factors that could cause NRG’s actual results
to differ materially from those contemplated in the forward-looking
statements included in this news release should be considered in
connection with information regarding risks and uncertainties that
may affect NRG’s future results included in NRG’s filings with the
Securities and Exchange Commission at www.sec.gov.
1 Based on market information as of NRG Energy’s 3rd Quarter
2015 earnings call on November 4, 2015
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version on businesswire.com: http://www.businesswire.com/news/home/20151201006802/en/
For NRG Energy, Inc.Media:Karen Cleeve,
609-524-4608orDave Gaier, 609-524-4529orInvestors:Chad
Plotkin, 609-524-4526orLindsey Puchyr, 609-524-4527
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