Direct Energy Announces Sale Of Three Texas Power Plants To Blackstone

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Dec 18, 2013, 04:19 ET

HOUSTON, Dec. 18, 2013 /PRNewswire/ -- Direct Energy, a subsidiary of Centrica plc (LSE: CNA), has reached an agreement with Blackstone (NYSE: BX) to sell its three gas-fired power generation facilities in Texas for $685 million in cash. The facilities, located in Bastrop, Mission, and Paris, Texas, are part of the Electric Reliability Council of Texas' (ERCOT) North and South zones and total approximately 1,295 megawatts (MW) of capacity.

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As part of the transaction, an affiliate of Direct Energy has entered into a three year call option arrangement for an equivalent amount of capacity with Blackstone.

Badar Khan, President and CEO of Direct Energy, said: "This transaction allows us to realize value from our gas-fired fleet, while ensuring stability of price and supply in the Texas power market through the call option arrangement."

"Residential retail supply is key to our North American business, and with sufficient generation capacity in Texas, we can support our downstream business through contractual arrangements, rather than asset ownership."

The transaction is subject to regulatory review and is expected to close in the first quarter of 2014.

Notes:

The transaction will be made through Centrica plc's affiliate, Direct Energy Power Holdings, Inc.
The power plants to be sold by Direct Energy Power Holdings, Inc. are listed below:

	Year of purchase	ERCOT region	Installed capacity (MW)
Bastrop	2004	South	540
Frontera (Mission)	2004	South	495
Paris	2006	North	260
Total			1,295

About Direct Energy

Direct Energy is one of North America's largest energy and energy-related services providers with more than six million residential and commercial customer relationships. Direct Energy provides customers with choice and support in managing their energy costs through a portfolio of innovative products and services. A subsidiary of Centrica plc (LSE:CNA), one of the world's leading integrated energy companies, Direct Energy operates in 46 U.S. states plus the District of Columbia and 10 provinces in Canada. For more information, visit www.directenergy.com.

SOURCE Direct Energy