Louisiana-based electric utility Cleco has completed its previously announced $1bn acquisition of NRG Energy’s South Central business.
Through the deal, which was announced in February 2018, the company’s unregulated subsidiary Cleco Cajun acquired eight power generating assets with a combined capacity of 3.5GW.
Also part of the acquisition are transmission operations and contracts to supply wholesale power to nine Louisiana cooperatives, five municipalities in Arkansas, Louisiana and Texas along with an investor-owned utility.
Last month, the Louisiana Public Service Commission (LPSC) approved the transaction to pave way for its closing.
Some of the assets acquired by Cleco through the acquisition are the 225MW Bayou Cove, the 430MW Big Cajun-I, the 1.46GW MW Big Cajun-II, the 1.26GW Cottonwood and the 176MW Sterlington power plants.
The company said that seven of the generation assets are managed by it while the Cottonwood power plant in Texas is leased back temporarily to NRG for operation.
It revealed that the transaction expanded the scale of its operations in Louisiana by more than doubling its generating capacity and growing the number of end-user customers by nearly 77%.
Cleco president and CEO Bill Fontenot said: “Cleco is transforming. Not only are we growing our company, but we are modernizing our company through technology and taking innovative approaches to grid modernization, to name a few.
“These projects, along with the acquisition of South Central, bring Cleco closer to achieving our vision of being Louisiana’s leading energy company.”
The divested South Central business by NRG is part of the company’s sale of certain US power assets for a total of $2.8bn it had taken up last year, to bring down its debt.
In August 2018, NRG completed the sale of its 46% stake in NRG Yield and also its US renewable energy platform to Global Infrastructure Partners for $1.35bn.
NRG president and CEO Mauricio Gutierrez said: “The closing of the South Central transaction marks the achievement of yet another fundamental milestone in our transformation.
“With the majority of our asset sales program complete, we continue to focus on capital allocation, cost excellence and margin enhancement across our businesses.”