Calpine Corp. on Friday said that a consortium of investors will buy the geothermal electricity supplier for $5.6 billion.
Energy Capital Partners along with a consortium of investors led by Access Industries and Canada Pension Plan Investment Board have agreed to pay $15.25 per share in cash for the company.
According to Calpine, it owns 13 geothermal facilities in California with a total generating capacity of 725 MW.
“We are very pleased to announce this proposed transaction and are confident it is in the best interests of our shareholders and stakeholders,” Frank Cassidy, chairman of Calpine’s Board of Directors, said in a statement. “This transaction is the result of an exhaustive review of strategic alternatives undertaken by our Board, with the assistance of outside advisors, to maximize shareholder value and unlock the company’s intrinsic value, while eliminating execution risk. We are confident that this is the best outcome of that review and look forward to shareholder approval.”
Calpine will maintain its corporate headquarters in Houston, with the current management team expected to remain in place. The company has 45 days to evaluate competitive offers.
Tyler Reeder, a partner at Energy Capital Partners, said the company does not expect to make any changes to the way Calpine operates its business.
Thad Hill, president and CEO of Calpine said: “With ECP, Calpine will be able to operate as it always has – executing on our strategic objectives of providing safe and reliable power and serving our retail and wholesale customers with differentiated products and services. We will also continue to strengthen our wholesale power generation footprint, while benefiting from ECP’s support, industry expertise and long-term investment horizon.”
Image credit: Rtracey | Public domain | Wikimedia
