DALLAS, Aug. 24, 2001 – TXU has today agreed to transfer its interests in Peterborough and King’s Lynn Combined Cycle Gas Turbine (CCGT) power stations to Centrica.
The power stations, comprising 705 megawatt of ISO standard capacity, are located in the East of England. The transaction is expected to be completed by the Autumn, and is subject to Office of Fair Trading approval.
The overall value for TXU is equivalent to GBP 252.5 ($366) million. Centrica is making a single, up-front, lease purchase payment of GBP 173.5 ($252) million with the balance of the value to TXU comprising benefits from financial structuring and retained UK tax allowances.
The transaction is also a further significant step towards TXU’s stated aim of reducing its UK generation capacity and strengthening its balance sheet. Today’s announcement follows TXU’s sale of its 1,000 megawatt Rugeley coal-fired power station to International Power in June 2001.
Under the terms of today’s transaction, Centrica will take over TXU’s entire economic interest and assumes future responsibility for electricity trading, fuel purchase, operation, maintenance and output in relation to the plants under a long-term leasing arrangement.
Commenting on the agreement, Martin Stanley, President, TXU Europe Energy Trading, said: “We are delighted to have signed this deal. This transaction is earnings enhancing in 2002, further strengthens our balance sheet, is a significant step towards achieving our optimum generation position in the UK market, and increases the proceeds of disposals to around GBP 1 billion.”
All TXU employees at the stations will be transferred to Centrica following the completion of formal consultation and there will be no job losses as a result of today’s announcement.
TXU is a global leader in electric and natural gas services, energy delivery, merchant trading, energy marketing, telecommunications, and other energy-related services. TXU is one of the largest energy companies in the world with more than $27 billion of annual revenue and $43 billion of assets. TXU has 30,000 megawatts of power generation and sells 300 million megawatt hours of electricity and 2.7 trillion cubic feet of natural gas annually. TXU delivers or sells energy to 11 million customers primarily in the US, Europe and Australia. Visit www.txu.com for more information about TXU.