NRG Energy to buy Edison Mission Energy for $2.64 billion

NRG Energy said October 18 it would buy Edison Mission Energy and some of its units for an aggregate purchase price of $2.635 billion. The aggregate purchase price includes 12.7 million shares of NRG common stock valued at $350 million, with the balance to be paid in cash on hand.

EME and NRG have signed an asset purchase agreement. The purchase agreement will be consummated as part of EME’s Chapter 11 plan of reorganization to be sponsored by NRG.

NRG will buy nearly 8,000 MW of EME’s power generation capacity, including 1,700 MW of wind; 1,600 MW of gas-fired capacity; 4,300 MW of coal-fired capacity; and 400 MW of oil and waste coal-fired capacity. NRG will also acquire Edison Mission Marketing and Trading, a proprietary trading and asset management platform. EME and several of its units filed for Chapter 11 bankruptcy in December 2012.

NRG will assume the Powerton and Joliet Lease and NRG will guarantee the remaining payments under each lease. NRG will fund up to $350 million in capital expenditures for plant modifications at Powerton and Joliet to ensure Mercury and Air Toxics Standards compliance.

The hearing to approve the plan sponsor agreement is expected on or before October 25, 2013. EME will then file a motion to seek a Chapter 11 plan of reorganization, and seek approval and closure of the deal in early 2014.

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