Dynegy acquires Duke energy’s power assets for $6.25 Billion

Dynegy acquires Duke energy's power assets for $6.25 Billion

Dynegy acquires Duke energy's power assets for $6.25 Billion

Dynegy, the power producer, which exited Chapter 11 bankruptcy in 2012, announced two deals for natural gas and coal generation assets worth a total of $6.25 Billion.

This deal includes power plants in the Midwest from Duke Energy and its reatil business for $2.8 Billion and plants in New England, Pennsylvania and the Midwest from the private equity firm Energy Capital Partners for $3.45 Billion.

“The addition of these portfolios transforms Dynegy by adding considerable scale in the PJM and New England markets,” Dynegy’s chief executive, Robert C. Flexon, said in a statement, referring to the wholesale power market, the PJM Interconnection.

Dynegy with headquarters in Houston, plans to issue $5 billion in new unsecured bonds and $1.25 billion in equity and equity-linked securities to finance the transactions.

Duke energy is the largest electric power and gas holding company, which serve 7.2 million U.S. customers in the Southeast and Midwest.

These two deals are expected to close by the end of the first quarter 2015.

Financial advisors on both transactions are Lazard and Credit Suisse. Morgan Stanley advised the Equity Capital Partners deal, and Goldman Sachs advised on the purchase from Duke Energy.

Mr. Stakebay says:

These two transactions are giving Dynegy almost 26 000 megawatts of generating capacity and access to three new retail markets: Pennsylvania, Michigan and Ohio. The company is also looking for synergies to generate cost reductions of $40 million a year, along with $200 million in collateral efficiencies and tax-related savings about $500 million. It also tripled its outlook for EBITDA for 2015.

 

DYNEGY

DUKE ENERGY

Revenue

$ 1.466 billion (2013)

$ 24.6 billion (2013)

Operating income

$ – 318 billion (2013)

$ 4.98 billion (2013)

Profit

$ – 356 billion (2013)

$ 2.68 billion (2013)

Total assets

$ 5.291 billion (2013)

$ 114.78 billion (2013)

Total Equity

$ 2.207 billion (2013)

$ 41.41 billion (2013)

Employees

1710 (2013)

29250 (2012)

 

President and CEO of Dynegy …….Robert C. Flexon…….(2011-present)………..$ 5 944 738 (2013)

CEO of Duke Energy……………………..Lynn Good……….(2009-present)…………$ 6 473 010 (2013)

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