By the OGJ Online Staff
HOUSTON, Sept. 18, 2001 – Independent power producer Reliant Resources Inc. said it is evaluating strategic alternatives of its European power generation assets, including the possible sale of its Dutch unit Reliant Energy Power Generation Benelux NV, formerly known as NV UNA.
Reliant acquired the Dutch power company, which has 3,476 Mw of net generating capacity for $2.4 billion, in 1999. The company represents about 20% of the country’s generating capacity.
At the time, Reliant said the company would become the vehicle for future expansion in Western Europe, as the region deregulated its energy markets.
“Reliant Resources continually evaluates its business portfolio and makes adjustments as necessary to ensure that our capital and human resources are optimally deployed to support the company’s growth objectives,” said Robert W. Harvey, executive vice-president. “We have recently been contacted by a number of parties who have expressed an interest in our European generating assets, and this led to our decision to review strategic alternatives.”
In July, Reliant Resources, Houston, reported operating income from its European unit fell to $9 million in the second quarter from $26 million in the comparable 2000 period. It blamed a decline in gross margins, resulting from the January 2000 launch of the wholesale electricity market in the Netherlands.
Reliant Resources is 80%-owned by Reliant Energy Inc.
Analysts said they needed to hear more about the reasons for the proposals and whether it represented a change in strategy for the company. In addition to its European operations, which include a wholesale trading and marketing unit, Reliant Resources has nearly 20,000 Mw of power generation in operation, under construction, or contract in the US and is one of the largest US wholesalers of gas and power.