UK . MERGERS & ACQUISITIONS
Killinghome Power has announced the sale of its 652 MWe combined cycle gas turbine power plant in Lincolnshire to Centrica, the UK group that owns British Gas, for £142 million. Completion is expected to take place by July this year.
Killingholme was commissioned in 1993. In 2000 it was bought from National Power by US energy company NRG for £390m. NRG operated the plant until 2003 when a syndicate of twenty stakeholder banks acquired the plant after it found itself in financial difficulties when the price of wholesale power fell sharply.
John Mapplebank, chairman of Killingholme Power, commented: “Killingholme expects that all the banks will receive full payment of all their debt. This is a tremendous result that seemed unlikely 18 months ago. The high level of interest from both trade and non-trade participants was a key factor in maximising the value that Killingholme was able to achieve for its shareholders.”
Centrica said that it was buying Killingholme in a bid to secure its winter supply needs at an advantageous price. The purchase means that British Gas can meet 43% of its peak domestic demand for electricity in 2005, up from 32% previously.
Centrica will take over responsibility for the operation and management of the plant, which employs 62 staff.
In addition to the sale of its power plant, Killingholme Power has successfully disposed of its long-term gas supply agreements and associated trading book to Deutsche Bank.
•In the US Centrica has announced that it has successfully completed its transaction to acquire Bastrop Energy Partners, owner of the 540 MWe natural gas-fired combined cycle Bastrop Energy Centre (BEC) in Texas, for $143 million in cash. This acquisition is Centrica’s first purchase of a generation asset in the USA. Centrica focused its search for US generation assets on Texas, where it already serves nearly 1 million customers.