Located in Guadalupe County, Texas, the natural gas-fired plant features two 525MW generation blocks, each comprising two GE 7FA combustion turbines, two heat recovery steam generators, as well as one GE steam turbine.

The acquisition also includes rights to an advanced development opportunity for an approximately 400MW quick-start, natural gas-fired peaker, if market conditions warrant.

Calpine chief executive officer Jack Fusco said the company strongly believe in the potential of the Texas market as reserve margins tighten and electric demand increases.

”Acquiring this modern, flexible and efficient plant in ERCOT’s south zone at a discount to replacement cost furthers our strategic objectives in this key market,” Fusco added.

”The Guadalupe acquisition exemplifies our commitment to making disciplined capital allocation decisions that will enhance shareholder value.”

Subject to customary closing conditions, antitrust review under the Hart-Scott-Rodino Act, and approval by the Public Utility Commission of Texas, the transaction is expected to close in the first quarter of 2014.

White & Case served as legal counsel to Calpine, while Vinson & Elkins, and Tudor, Pickering, Holt & Co. served as legal counsel and exclusive financial advisor to Wayzata, on the transaction.