Dynegy Inc fka DYN

[Enterprising Investor]

Dallas power co. reportedly interested in Dynegy takeover (5/19/17)

by Olivia Pulsinelli

Dallas-based Vistra Energy Corp. (NYSE: VST) reportedly has approached Houston-based Dynegy Inc. (NYSE: DYN) about a potential takeover.

People familiar with the matter told the Wall Street Journal the companies are in preliminary talks, so a deal is not guaranteed.

However, if a deal were to occur, it would create one of the largest independent power producers in the U.S., according to the WSJ.

Vistra Energy, the parent company of TXU Energy and Luminant, emerged from bankruptcy as a spin-off of Energy Future Holdings last year. That restructuring eliminated $33 billion of debt, and the company now has a market value of more than $6 billion and debt of more than $4.5 billion, the WSJ reports.

Dynegy emerged from its own bankruptcy in 2012 and has grown a lot since then, including the acquisition of assets in two multibillion-dollar deals with North Carolina-based Duke Energy Corp. (NYSE: DUK) and New Jersey-based Energy Capital Partners that closed in 2015.

In early February, Dynegy acquired Engie’s U.S. portfolio for $3.3 billion the same week a Dynegy subsidiary emerged from bankruptcy. Illinois Power Generating Co., or Genco, eliminated $825 million of unsecured bonds during its two-month restructuring. More recently, however, the company decided to reduce spending through 2018 and sell more North American power assets.

Meanwhile, CEO Bob Flexon was adamant in December that Dynegy was not for sale.

Dynegy ranks No. 34 on the Houston Business Journal's 2016 Largest Houston-based Public Companies List.

Separately, the WSJ reported last week that another Houston-based power company was interested in selling itself. A variety of private equity firms reportedly have expressed interest in Calpine Corp. (NYSE: CPN), which is working with investment bankers at Lazard Ltd. (NYSE: LAZ), per the WSJ. However, the process is in the early stages, and there’s no guarantee a deal will be reached.

http://www.bizjournals.com/houston/news/2017/05/19/dallas-power-co-reportedly-interested-in-dynegy.html