NRG Announces $1.75 Billion Asset Sale, Unlocking Significant Shareholder Value; Announces 2023 Investor Day
01 Junho 2023 - 8:01AM
Business Wire
Leverage Neutral Transaction; Accelerates &
Upsizes Share Repurchase Program
NRG Energy, Inc. (NYSE: NRG) today announced that it has entered
into a definitive agreement to sell its 44% equity interest in
South Texas Project Electric Generating Station (STP) to
Constellation Energy for a purchase price of $1.75 billion, subject
to customary purchase price adjustments. The purchase price
represents an implied valuation multiple of 11.7x EV/EBITDA and
17.5x Free Cash Flow.
“Today’s announcement is the continuation of our strategy to
optimize our portfolio while creating significant shareholder
value,” said Mauricio Gutierrez, NRG President and Chief Executive
Officer. "The work on this transaction over the last several months
will release significant capital to be deployed at
value—accelerating and upsizing our current share repurchase
program while achieving our balance sheet targets.”
The transaction is targeted to close by the end of 2023, subject
to regulatory approvals by the United States Nuclear Regulatory
Commission, Hart-Scott-Rodino, and the Public Utility Commission of
Texas. Upon closing, the sale exceeds the previously disclosed 2023
asset sale target of $500 million. The sale is expected to be
leverage neutral with net cash proceeds, after $500 million of
deleveraging, to be used primarily for share repurchases.
STP is a 2,645 MW nuclear facility located about 90 miles
southwest of Houston in Bay City, Texas. NRG’s current 44% interest
represents approximately 1,100 MWs of output.
Barclays Capital Inc. and Morgan Stanley & Co. LLC are
serving as NRG’s financial advisors, and McGuireWoods LLP is
serving as legal counsel.
Share Repurchase Update
On May 31, 2023, the NRG Board of Directors authorized $650
million in share repurchases to be initiated following the closing
of the STP sale. This authorization, when combined with the
approximately $350 million remaining under the existing share
repurchase program, brings the total amount of share repurchases to
be completed to $1 billion.
NRG reiterates its expectation to achieve its investment grade
2.50x to 2.75x corporate net debt to adjusted EBITDA credit metrics
by late 2025 or 2026.
NRG to Host 2023 Investor Day
NRG plans to host its 2023 Investor Day on Thursday, June 22,
2023, at 9:00 am Eastern Time. A live webcast of the event,
including presentation materials, will be posted on NRG’s website
at www.nrg.com under the ‘investors’ section. The event will be
archived on the site for those unable to listen in real-time.
Forward-Looking Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Forward-looking
statements are subject to certain risks, uncertainties and
assumptions and typically can be identified by the use of words
such as “expect,” “estimate,” “should,” “anticipate,” “forecast,”
“plan,” “guidance,” “outlook,” “believe” and similar terms.
Although NRG believes that the expectations are reasonable, it can
give no assurance that these expectations will prove to be correct,
and actual results may vary materially.
NRG undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law. The
foregoing review of factors that could cause NRG’s actual results
to differ materially from those contemplated in the forward-looking
statements included in this news release should be considered in
connection with information regarding risks and uncertainties that
may affect NRG’s future results included in NRG’s filings with the
SEC at www.sec.gov.
About NRG
NRG Energy is a leading energy and home services company powered
by people and our passion for a smarter, cleaner, and more
connected future. A Fortune 500 company operating in the United
States and Canada, NRG delivers innovative solutions that help
people, organizations, and businesses achieve their goals while
also advocating for competitive energy markets and customer choice.
More information is available at www.nrg.com. Connect with NRG on
Facebook and LinkedIn, and follow us on Twitter, @nrgenergy.
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version on businesswire.com: https://www.businesswire.com/news/home/20230601005632/en/
Media: Laura Avant 713.537.5437 Laura.avant@nrg.com
Investors: Brendan Mulhern 609.524.4767
Investor.relations@nrg.com
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