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NRG Energy Enters Into Agreement To Acquire Edison Mission Energy

NRG Energy, Inc. (NYSE:NRG) has entered into a plan sponsor agreement with Edison Mission Energy (EME), certain of EME’s subsidiaries, the unsecured creditors committee, certain of EME’s unsecured noteholders, and the parties to the Powerton and Joliet sale leaseback transaction to acquire substantially all of the assets of EME, including its equity interests in certain of its subsidiaries, for an aggregate purchase price of $2,635 million (or $1,572 million net of $1,063 million retained cash within EME). The aggregate purchase price, which is subject to certain post-closing adjustments, will consist of approximately 12.7 million shares of NRG common stock (valued at $350 million based upon the volume-weighted average trading price of the 20 trading days prior to October 18, 2013) with the balance to be paid in cash on hand. In connection with the transaction, NRG will also assume non-recourse debt of approximately $1,545 million, of which $273 million is associated with assets designated as Non-Core Assets pursuant to the asset purchase agreement.

EME and NRG have entered into an asset purchase agreement, dated October 18, 2013. The acquisition and transactions contemplated in the purchase agreement will be consummated as part of an EME Chapter 11 plan of reorganization to be sponsored by NRG. Each of EME’s major stakeholders has agreed to support and pursue a Chapter 11 plan sponsored by NRG.

The assets to be acquired include:

  • EME’s generation portfolio, which consists of nearly 8,000 net MW of generation capacity located throughout the US:
    • 1,700 MW of wind capacity
    • 1,600 MW of gas-fired capacity
    • 4,300 MW of coal-fired capacity
    • 400 MW of oil and waste coal-fired capacity
  • Edison Mission Marketing and Trading, a proprietary trading and asset management platform

“Edison Mission Energy is a great fit with NRG, as virtually 100% of their assets, their particular expertises and the balance of their technologies deployed complement NRG’s own assets, personnel and businesses,” said David Crane, President and CEO of NRG Energy. “We look forward to working with EME’s employees, its management and its owners to close this transaction expeditiously and ensure that the ensuing integration achieves the best possible outcome for all concerned.”

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