Calpine to Acquire Guadalupe Power Partners Generating Facility in Texas
December 3, 2013
(HOUSTON, Texas) December 2, 2013 – Calpine Corporation (NYSE:CPN) has agreed to purchase a nominal 1,050 megawatt, combined-cycle power plant for $625 million, or approximately $595 per kilowatt, exclusive of adjustments relating to development rights and working capital, from MinnTex Power Holdings, LLC, a portfolio company owned by a private investment fund managed by Wayzata Investment Partners LLC. The natural gas-fired plant is located in Guadalupe County, 30 miles northeast of San Antonio, Texas.
“Guadalupe is an exceptional plant with an outstanding performance record that meets Calpine’s high standards for operational excellence,” said Calpine’s Chief Executive Officer Jack Fusco. “We strongly believe in the potential of the Texas market as electric demand increases and reserve margins tighten. Acquiring this modern, flexible and efficient plant in ERCOT’s south zone at a discount to replacement cost furthers our strategic objectives in this key market. The Guadalupe acquisition exemplifies our commitment to making disciplined capital allocation decisions that will enhance shareholder value.”
Located on a 110-acre site, the Guadalupe plant includes two 525 megawatt generation blocks, each consisting of two GE 7FA combustion turbines, two heat recovery steam generators and one GE steam turbine. In addition, the purchase includes rights to an advanced development opportunity for an approximately 400 megawatt quick-start, natural gas-fired peaker, if market conditions warrant.
Calpine is targeting a transaction close in the first quarter of 2014 and expects to fund the transaction with cash on hand. The transaction is subject to customary closing conditions, antitrust review under the Hart-Scott-Rodino Act, and approval by the Public Utility Commission of Texas. White & Case LLP served as legal counsel to Calpine.
Vinson & Elkins, LLP served as legal counsel to Wayzata on the transaction, and Tudor, Pickering, Holt & Co. served as Wayzata’s exclusive financial advisor.
Calpine Corporation generates more electricity than any other independent power producer in America, with a fleet of 93 power plants in operation or under construction, representing more than 28,000 megawatts of generation capacity. Serving customers in 20 states and Canada, we specialize in developing, constructing, owning and operating natural gas-fired and renewable geothermal power plants that use advanced technologies to generate power in a low-carbon and environmentally responsible manner. Our clean, efficient, modern and flexible fleet is uniquely positioned to benefit from the secular trends affecting our industry, including the abundant and affordable supply of clean natural gas, stricter environmental regulation, aging power generation infrastructure and the increasing need for dispatchable power plants to successfully integrate intermittent renewables into the grid. We focus on competitive wholesale power markets and advocate for market-driven solutions that result in nondiscriminatory forward price signals for investors. Please visit www.calpine.com to learn more about why Calpine is a generation ahead – today.
Based in Wayzata, Minnesota with branch offices in Boston, Houston, London, Singapore, and Mumbai, Wayzata Investment Partners LLC is an SEC registered investment adviser to private investment funds with in excess of $7 billion in assets under management.
In addition to historical information, this release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as “believe,” “intend,” “expect,” “anticipate,” “plan,” “may,” “will,” “should,” “estimate,” “potential,” “project” and similar expressions identify forward-looking statements. Such statements include, among others, those concerning expected financial performance and strategic and operational plans, as well as assumptions, expectations, predictions, intentions or beliefs about future events. You are cautioned that any such forward-looking statements are not guarantees of future performance and that a number of risks and uncertainties could cause actual results to differ materially from those anticipated in the forward-looking statements. Please see the risks identified in this release or in Calpine’s reports and registration statements filed with the Securities and Exchange Commission, including, without limitation, the risk factors identified in its Annual Report on Form 10-K for the year ended Dec. 31, 2012. These filings are available by visiting the Securities and Exchange Commission’s website at www.sec.gov or Calpine’s website at www.calpine.com. Given the risks and uncertainties surrounding forward-looking statements, you should not place undue reliance on these statements. Many of these factors are beyond our ability to control or predict. Our forward-looking statements speak only as of the date of this release. Actual results or developments may differ materially from the expectations expressed or implied in the forward-looking statements, and, other than as required by law, Calpine undertakes no obligation to update any such statements, whether as a result of new information, future events, or otherwise.