Dynegy today announced that it has entered into an agreement to purchase from Exelon Corporation all of the outstanding capital stock of its subsidiary, ExRes SHC, the parent company of Sithe Energies and Sithe Independence.
Through this acquisition, Dynegy will acquire the 1,042-megawatt, 7,211-Btu heat rate, combined-cycle Independence power generation facility located near Scriba, NY, four natural gas-fired merchant facilities in New York and four hydroelectric generation facilities in Pennsylvania.
In addition to the power plants, Dynegy will acquire Sithe Independence, which holds a 750-megawatt firm capacity sales agreement with Con Edison, a subsidiary of Consolidated Edison. The capacity sales agreement, which runs through 2014, provides annual cash receipts to Dynegy of approximately $100 million.
The financial terms of the agreement include the payment by Dynegy of $135 million in cash and the consolidation of $919 million in project debt. Dynergy said in a statement that the principal and interest payments related to the consolidated debt will be funded through to 2014 by the proceeds from the long-term capacity sales contract with Con Edison.
The transaction is subject to customary closing conditions, including the receipt of approvals from various federal and state regulatory authorities in the US.