International Power has agreed to buy 1,857MW in peaking capacity from a Tenaska/Warburg Pincus joint venture. IP is paying $856.4 million for the plants, and funding this, and $39 million in transaction costs, through a $434 million RBS-led non-recourse loan and $461 million in equity. According to the buyer, the deal is scheduled to close in the third quarter of this year, and the deal will be subject to approval from U.S. regulators.
The portfolio consists of four peaking projects, of which all but one -Calumet - is being sold by the Tenaska Power Fund/Warburg Pincus joint venture (Calumet's sole owner is TPF). The four are:
*Armstrong, a 625 MW gas/oil-fired plant in Pennsylvania, that dispatches into PJM;
*Pleasants, a 313 MW gas/oil-fired plant in West Virginia, that dispatches into PJM;
*Calumet, a 303 MW gas-fired plant
in Illinois, that dispatches into PJM; and
*Troy, a 616 MW gas/oil-fired plant in Ohio that dispatches into the MISO market.
