Black Hills to Sell Seven Independent Power Plants
Posted on: Monday, 5 May 2008, 03:00 CDT
Black Hills has signed a definitive agreement with affiliates of Hastings Funds Management and IIF BH Investment to sell seven independent power production gas-fired plants with a total capacity of 974MW for $840 million cash, subject to certain working capital adjustments.
Under the terms of the agreement, the company has the right to retain ownership of the Fountain Valley power plant in Colorado in the event closing conditions for the company's planned acquisition of utility assets from Aquila are not met.
The purchase price for the Fountain Valley plant represents $240 million of the total $840 million purchase price. The closing of the independent power production (IPP) sale, pending customary regulatory approvals, is expected to occur in the late second quarter or early third quarter of 2008.
David Emery, chairman, president and CEO of Black Hills, said: "Our process was comprehensive and we believe this transaction produces the best result for our shareholders. The net proceeds from the pending IPP sale are expected to eliminate or reduce our need to issue equity to finance the pending Aquila purchase."
Source: Datamonitor
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