US Power Generating to merge with Tenaska Capital

US Power Generating Co. entered into a definitive agreement and plan of merger with Tenaska Capital Management affiliates (TCM). Pursuant to the terms of the agreement, USPG will become a unit of TCM.

Under the terms of the merger, TCM will purchase USPG, with the final price being determined by a number of business and tax adjustments. USPG’s debt was upsized by $125 million in conjunction with the merger.

Consummation of the merger is subject to customary conditions including approvals of the Federal Energy Regulatory Commission (FERC) and the New York Public Service Commission, as well as expiration of the waiting period regarding the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Goldman, Sachs & Co. and Morgan Stanley & Co. LLC acted as financial advisors, and Latham & Watkins LLP as legal counsel, to USPG on the merger transaction. Goldman Sachs Lending Partners LLC, Morgan Stanley Senior Lending Fund and Deutsche Bank Securities Inc. wereengaged to arrange, and Kirkland & Ellis, LLP advised USPG, on the debt upsize transaction.

USPG owns and operates 53 generating units at three facilities with a total summer capacity of over 2,180 MW). The company sells energy and capacity into the NYISO deregulated market and represents generation sufficient to serve about 20 percent of the overall load in New York City.

TCM, an affiliate of Omaha, Neb.-based Tenaska, is a leading manager of energy private equity investments. TCM has about $3.5 billion in assets under management and targets investments in power generation, oil and natural gas midstream and energy services.

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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