Duke Energy will sell its non-regulated Midwest Commercial Generation Business to Dynegy for $2.8bn in cash.

The deal comprises ownership interests in 11 power plants and Duke Energy Retail Sales, the company’s retail business in Ohio.

Duke Energy Commercial Businesses president Marc Manly said: "This transaction is an important milestone in our strategy to exit the merchant generation business.

"In the coming months, we will continue to safely operate these plants and work closely with Dynegy to obtain the regulatory approvals necessary to close the transaction."

Duke Energy president, CEO and vice-chairman Lynn Good said: "These power plants have been important to Duke Energy and our Midwest customers for many years, and I am proud of the employees who have operated these plants well in challenging market conditions."

"This transaction is an important milestone in our strategy to exit the merchant generation business."

The transaction, which is expected to occur in three to six months, is subject to approval of the Federal Energy Regulatory Commission.

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The Midwest generation business comprises 11 merchant power plants, which have a capacity of approximately 6,100MW.

The plants are fully owned or partially-owned by Duke Energy Ohio.

Currently, the transaction proceeds are being evaluated.

The Duke Energy Ohio, Kentucky and Duke Energy Indiana regulated utilities are excluded from the transaction.

Of the 11 power plants, nine are located in Ohio, one in Illinois and one in Pennsylvania.