Dynegy Inc, the parent company of Illinois Power Company, today announced that Ameren Corp will acquire all of the outstanding common and preferred stock of Illinois Power for $2.3 billion.
The agreement also includes the sale of Dynegy’s 20 percent minority interest in the Joppa power generation facility in Joppa, Illinois. Ameren is currently the operator of and has a 60 percent ownership interest in the 1,086-gross-megawatt coal-fired facility.
The $2.3 billion purchase price includes the assumption of Illinois Power’s debt, which is estimated to be approximately $1.8 billion.
As part of the deal, Dynegy has agreed to sell 2,800 megawatts of capacity and energy to Illinois Power for two years from January 2005. The capacity will be provided by Dynegy’s generation facilities in Illinois and used by Ameren to meet Illinois Power’s customer demand.
The acquisition is expected to close in the fourth quarter of 2004, subject to conditions that include approvals from the Illinois Commerce Commission, the Federal Energy Regulatory Commission and the Securities and Exchange Commission.
‘This transaction is a significant step forward in our ongoing efforts to improve the balance sheets of both Dynegy and Illinois Power and to create financially stronger companies,’ said Bruce A. Williamson, president and chief executive officer of Dynegy Inc.
‘Our agreement will also further solidify Dynegy’s position as an operationally focused company with a business model consisting of unregulated energy businesses where we believe we have competitive advantages, market share and growth potential for our shareholders,’ added Williamson.