NRG Energy has entered a definitive agreement to acquire LS Power Equity Advisors’ natural gas generation facilities and a commercial and industrial virtual power plant (C&I VPP) platform portfolio.
The transaction includes a cash and common stock deal valued at approximately $12bn. This deal is poised to double NRG’s generation capacity.
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The transaction’s enterprise value comprises $6.4bn in cash consideration, $2.8bn in stock consideration to LS Power, $3.2bn of net debt assumed at closing and approximately $400m of the net present value of tax benefits generated by the transaction.
LS Power will own around 11% of the pro forma NRG shares outstanding and has agreed to a six-month lock-up period on its equity ownership of NRG common stock.
The assets include 18 natural gas-fired facilities across nine states, totalling around 13GW. The acquisition also includes CPower, a C&I VPP platform, enhancing NRG’s presence in deregulated energy markets.
NRG anticipates a compounded annual growth rate target increase for adjusted earnings per share to at least 14%, up from the current 10% target.
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By GlobalDataAdditionally, NRG plans to return approximately $9.1bn to shareholders through share repurchases and dividends over the next five years.
NRG’s acquisition of these assets, which are irreplicable and of high quality, will transform its generation fleet and enhance its ability to serve customers in the north-east and Texas markets.
NRG is working towards maintaining a strong balance sheet and expects to achieve its target leverage ratio within 24–36 months after closing.
The acquisition is slated for completion in the first quarter of 2026 (Q1 2026), subject to regulatory approvals. LS Power will retain around 10GW of electric generation capacity and its LS Power Grid platform, which includes more than 780 miles of high-voltage transmission lines.
NRG chair, president and CEO said: “The transaction is financially compelling as it strengthens our credit profile and turbocharges NRG’s growth rate, while also supporting continued robust capital returns. We are in the early stages of a power demand supercycle, and we are excited to lead the way with reliable energy solutions that will drive considerable value for NRG and all of our stakeholders.”
NRG’s advisors for the transaction include Citi and Goldman Sachs, with committed financing provided by Citi and Goldman Sachs Bank USA. LS Power’s financial advisors include Evercore, J.P. Morgan and Morgan Stanley, with Milbank and Willkie Farr & Gallagher as legal counsel.
In March 2025, NRG Energy signed a definitive agreement to acquire six power plants in the US state of Texas from Rockland Capital for $560m.
