CenterPoint Energy Announces Sale of Texas Genco for $3.65 Billion;
Sale Also Includes Buy-Out of Public Shareholders HOUSTON, July 21
/PRNewswire-FirstCall/ -- CenterPoint Energy, Inc. (NYSE:CNP) and
Texas Genco Holdings, Inc. (NYSE:TGN) today announced a definitive
agreement for GC Power Acquisition LLC, a newly formed entity owned
in equal parts by affiliates of The Blackstone Group, Hellman &
Friedman LLC, Kohlberg Kravis Roberts & Co. L.P. and Texas
Pacific Group, to acquire Texas Genco, a wholesale electric power
generation company, for approximately $3.65 billion in cash. The
agreement includes a buy-out of Texas Genco's public shareholders.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020930/CNPLOGO
http://www.newscom.com/cgi-bin/prnh/20030127/DAM020LOGO ) The
transaction, subject to customary regulatory approvals, will be
accomplished in two steps. The first step, expected to be completed
in the fourth quarter of 2004, involves Texas Genco's purchase of
the 19 percent of its shares owned by the public for $47 per share,
followed by GC Power Acquisition's purchase of a Texas Genco unit
that will be formed to own its coal, lignite and gas-fired
generation plants. In the second step of the transaction, expected
to take place in the first quarter of 2005 following receipt of
approval by the Nuclear Regulatory Commission, GC Power Acquisition
will complete the acquisition of Texas Genco, the principal
remaining asset of which will then be Texas Genco's interest in the
South Texas Project nuclear facility. Total cash proceeds to
CenterPoint Energy from both steps of the transaction will be
approximately $2.9 billion, or $45.25 per share for its 81 percent
interest in Texas Genco. The transaction has been approved by the
board of directors of CenterPoint Energy and by the board of
directors of Texas Genco acting upon the unanimous recommendation
of a special committee composed of independent members of the Texas
Genco Board. "We believe that the sale of Texas Genco is beneficial
for both companies," said David M. McClanahan, president and chief
executive officer of CenterPoint Energy. "The sale enables
CenterPoint Energy to reduce its debt and concentrate on its energy
delivery businesses. "I am also pleased that Texas Genco's new
owner is backed by some of today's strongest private equity
investment firms, which should allow it to build on the firm
foundation that the management and employees of Texas Genco have
established over the years. Of course it's hard for us at
CenterPoint Energy to let go of a business that has been a part of
our company for so many years. But under the plan we developed in
response to the 1999 Texas electric restructuring law, it is time
for CenterPoint Energy to take this step," said McClanahan. The
Blackstone Group, Hellman & Friedman LLC, Kohlberg Kravis
Roberts & Co. L.P. and Texas Pacific Group said in a statement:
"We have focused extensively on the energy sector and we are
excited to purchase Texas Genco, one of the nation's largest
independent electric generating companies. Through Texas Genco, we
are acquiring high quality coal, nuclear and gas power plants in
the rapidly growing Houston market. We look forward to joining with
the dedicated employees of a newly-independent Texas Genco to
continue to provide outstanding service to Texas Genco's customers
while developing the nation's premier independent power generation
business." CenterPoint Energy was advised on the transaction by
Citigroup Global Markets Inc. and Baker Botts L.L.P., and the
special committee of independent directors of Texas Genco was
advised by RBC Capital Markets Corporation and Haynes and Boone,
LLP. GC Power Acquisition LLC was advised by Goldman Sachs,
Deutsche Bank and Morgan Stanley and the law firms Simpson Thacher
& Bartlett LLP, Stroock & Stroock & Lavan LLP and
Vinson & Elkins LLP. CenterPoint Energy, Inc., headquartered in
Houston, Texas, is a domestic energy delivery company that includes
electric transmission & distribution, natural gas distribution
and sales, interstate pipeline and gathering operations, and
currently owns 81 percent of Texas Genco Holdings, Inc. The company
serves nearly five million metered customers primarily in Arkansas,
Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. Assets
total over $21 billion. With more than 11,000 employees,
CenterPoint Energy and its predecessor companies have been in
business for more than 130 years. For more information, visit the
Web site at http://www.centerpointenergy.com/ . Texas Genco
Holdings, Inc., based in Houston, Texas, is one of the largest
wholesale electric power generating companies in the United States
with over 14,000 megawatts of generation capacity. It sells
electric generation capacity, energy and ancillary services in one
of the nation's largest power markets, the Electric Reliability
Council of Texas (ERCOT). Texas Genco has one of the most
diversified generation portfolios in Texas, using natural gas, oil,
coal, lignite, and uranium fuels. The company owns and operates 60
generating units at 11 electric power-generating facilities and
owns a 30.8 percent interest in a nuclear generating plant. For
more information, visit our web site at http://www.txgenco.com/ .
The Blackstone Group, a private investment and advisory firm with
offices in New York, Atlanta, Boston, London and Hamburg, was
founded in 1985. The firm has raised a total of approximately $32
billion for alternative asset investing since its formation. Over
$14 billion of that has been for private equity investing,
including Blackstone Capital Partners IV, the largest institutional
private equity fund at $6.45 billion. Blackstone has made private
equity investments throughout the energy sector including petroleum
refining, oil and gas exploration and coal mining. In addition to
Private Equity Investing, The Blackstone Group's core businesses
are Private Real Estate Investing, Corporate Debt Investing,
Marketable Alternative Asset Management, Corporate Advisory, and
Restructuring and Reorganization Advisory. For more information,
visit http://www.blackstone.com/ . Hellman & Friedman LLC is a
San Francisco-based private equity investment firm with additional
offices in New York City and London. Since its founding in 1984,
the Firm has raised and managed approximately $5 billion of
committed capital and invested in over 45 companies. Hellman &
Friedman recently completed raising its fifth fund, Hellman &
Friedman Capital Partners V, L.P., a $3.5 billion fund.
Representative investments include Axel Springer AG (ASV GR),
ProSieben Sat.1 AG (PSM GR), Formula One Holdings, Ltd, Arch
Capital Group Limited (ACGL), the NASDAQ Stock Market, Inc. (NDAQ),
Young & Rubicam, Inc., Western Wireless Corporation (WWCA),
Franklin Resources, Inc. (BEN), and others. For more information,
visit http://www.hf.com/ . Kohlberg Kravis Roberts & Co. L.P.
is one of the world's oldest and most experienced private equity
firms specializing in management buyouts, with offices in New York,
Menlo Park, California, and London, England. For more information,
please visit http://www.kkr.com/ . Texas Pacific Group, founded in
1993 and based in Fort Worth, TX, San Francisco, CA, and London, is
a private investment partnership managing over $13 billion in
assets. Over the past several years, TPG has built an industry
practice focused on the energy and power sectors (Denbury
Resources, Portland General Electric (pending)). Additionally, the
firm seeks to invest in world- class franchises across a range of
other industries, including airlines (Continental, America West),
branded consumer franchises (Burger King, Del Monte, Ducati),
leading retailers (Petco, J.Crew, Debenhams - UK), healthcare
companies (Oxford Health Plans, Quintiles Transnational), and
technology companies (ON Semiconductor, MEMC, Seagate). This news
release includes forward-looking statements. Actual events and
results may differ materially from those projected. The statements
in this news release regarding future financial performance and
results of operations and other statements that are not historical
facts are forward-looking statements. Factors that could affect
actual results include the timing and impact of future regulatory
and legislative decisions, effects of competition, weather
variations, changes in CenterPoint Energy's or its subsidiaries'
business plans, financial market conditions, the timing and extent
of changes in commodity prices, particularly natural gas, the
impact of unplanned facility outages and other factors discussed in
CenterPoint Energy's and its subsidiaries' filings with the
Securities and Exchange Commission.
http://www.newscom.com/cgi-bin/prnh/20020930/CNPLOGO
http://www.newscom.com/cgi-bin/prnh/20030127/DAM020LOGO
http://photoarchive.ap.org/ DATASOURCE: CenterPoint Energy, Inc.;
Texas Genco Holdings, Inc. CONTACT: media, Leticia Lowe,
+1-713-207-7702, or investors, Marianne Paulsen, +1-713-207-6500,
both of CenterPoint Energy, Inc.; or John A. Ford of The Blackstone
Group, +1-212-583-5559; or Melissa Ma, +1-415-788-5111, or Steven
Bruce of Abernathy MacGregor, +1-212-371-5999, both for Hellman
& Friedman LLC; or David Lilly or Roanne Kulakoff,
+1-212-521-4800, both for Kohlberg Kravis Roberts & Co. L.P.;
or Owen Blicksilver, +1-516-742-5950, for Texas Pacific Group Web
site: http://www.centerpointenergy.com/ http://www.txgenco.com/
http://www.blackstone.com/ http://www.hf.com/ http://www.kkr.com/
Copyright
Texas Genco (NYSE:TGN)
Historical Stock Chart
From Jul 2024 to Aug 2024
Texas Genco (NYSE:TGN)
Historical Stock Chart
From Aug 2023 to Aug 2024