The US independent power producers (IPPs) Vistra Energy and Dynegy Corporation have announced a tax-free, all-stock merger deal, creating one of the lowest-cost integrated power company in the US power sector.
Dynegy is present throughout the Northeast, Mid-Atlantic, Midwest, and Texas, where it operates 27 GW of power generation facilities (17 GW of which are gas-fired and 9 GW of are coal-fired) and supplies 1.2 million customers. Vistra Energy is the parent company for TXU Energy and Luminant. It currently operates 18 GW of power generation facilities, including 2.3 GW of nuclear power plants, 8 GW of coal-fired, and 7.5 GW of gas-fired capacity, and supplies 1.7 million residential and business customers in Texas.
The resulting company is projected to have a combined market capitalization of US$10bn and a combined enterprise value over US$20bn. It will own 46 GW of capacity, of which 60% is gas-fired and almost 85% located in the Electric Reliability Council of Texas (ERCOT), PJM Interconnection and ISO New England (ISO-NE) competitive power markets. It will sell around 75 TWh/year on the retail markets, serving approximately 240,000 commercial and industrial customers along with 2.7 million residential customers.
The transaction closing is anticipated in the second quarter of 2018.
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