Mission Energy buys PowerGen plants
US developer Mission Energy has agreed to purchase PowerGen`s Fiddler`s Ferry and Ferrybridge C power plants for £1.3bn ($2.1bn). The sale satisfies the regulator`s requirements with respect to PowerGen`s acquisition of East Midlands Electricity, a distribution utility.
The deal, which is subject to regulatory approval in the UK, boosts Mission`s international generation portfolio to 23 500 MW.
The company paid £637m for Fiddler`s Ferry and £614m for Ferrybridge C, both of which are 2000 MW coal fired plants. Mission, the international arm of US energy group Edison International, said that it expects the two plants to add to its earnings in 1999. Edison will also pay £51m for coal stocks.
PowerGen, one of the UK`s largest generators, will supply the two plants with coal for four years on terms consistent with its overall coal commitments. In the nine months to December 1998, the two plants produced net operating profits before depreciation of £37m and £38m respectively.
The British government demanded the sale of the two plants in return for allowing PowerGen to buy East Midlands Electricity for £1.9bn last year. PowerGen`s previous attempts to buy distribution companies were blocked by the government to limit the generator`s market power.