Talen Energy to Sell Three Power Plants
October 08 2015 - 9:10AM
Dow Jones News
Talen Energy Corp., the spinoff of PPL Corp.'s power-generation
businesses, said on Thursday it has reached agreements to sell
three Pennsylvania power plants for about $1.51 billion.
The sales are part of the regulatory requirements allowing for
the creation of Talen earlier this year.
Talen said it was selling the more than 700-megawatt Ironwood
plant to a subsidiary of TransCanada Corp. for $654 million.
TransCanada said the acquisition of the plant is expected to
immediately add to earnings and will generate about $90 million to
$110 million in annual earnings before interest, taxes,
depreciation and debt repayment.
"The Ironwood power plant will be very complementary to our U.S.
northeast operations," said William Taylor, TransCanada's executive
vice president.
TransCanada said the transaction was expected to close in the
first quarter of 2016. The Calgary, Alberta-based TransCanada
operates a network of natural gas pipelines that extends more than
42,000 miles.
Talen's Holtwood and Lake Wallenpaupack hydroelectric projects,
with a combined capacity of nearly 300 megawatts, meanwhile, are
being sold to a subsidiary of Brookfield Renewable Energy Partners
L.P. for $860 million.
"These high-quality assets provide a unique opportunity to
leverage our operating platform and hydroelectric expertise in a
market facing significant coal retirements and increasing reliance
on renewables," said Sachin Shah, chief executive of Brookfield
Renewable.
Brookfield Renewable said the transaction provided a strong fit
with its 417-megawatt Safe Harbor facility located 8 miles upstream
from Holtwood.
Brookfield Renewable, a Hamilton, Bermuda-based electricity
company, said it expected the transaction to close by the first
quarter of 2016.
Talen said it expects to use net proceeds of the deals to pay
down debt, which stood at about $3.18 billion of long-term
borrowings as of midyear.
Talen's stock, inactive premarket, has lost half their value
since the spinoff in June.
Write to Ezequiel Minaya at ezequiel.minaya@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 08, 2015 08:55 ET (12:55 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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