Calpine To Buy Fore River Generating Station In New England For $530 Mln

(RTTNews) - Calpine Corp. (CPN), an utility company with natural gas-fired and geothermal power plants, has agreed to acquire a nominal 809 megawatt, combined-cycle power plant and related plant inventory from Exelon Corp. (EXC) for $530 million, or about $655 per kilowatt, subject to working capital adjustments. The natural gas-fired plant is situated in North Weymouth, Massachusetts, 12 miles southeast of Boston, and expands Calpine's footprint in the New England competitive wholesale power market.

"With the acquisition of Fore River, we will grow our presence in a region that features favorable fundamentals and a supportive, market-based regulatory philosophy," said Calpine's President and Chief Executive, Thad Hill. "This modern, efficient power plant is dual-fuel capable, making it an excellent fit with our existing, reliable East Region fleet. We continue to redeploy our capital to enhance shareholder value through accretive acquisitions and divestitures, organic growth, balance sheet management and return of capital to shareholders through our share repurchase program," he added.

Built in 2003, Fore River Generating Station features two Mitsubishi 501G combustion turbines, two heat recovery steam generators and one Mitsubishi steam turbine. The plant's dual-fuel capability enables it to run on either natural gas or fuel oil, depending on market conditions.

The transaction may close in the fourth quarter of 2014 and Calpine plans to fund the transaction with cash on hand.