TransAlta has signed a purchase and sale agreement to acquire two natural gas-fired power plants near Denver, Colorado, US, with a combined capacity of 318MW, for $1bn (C$1.39bn).
Under the agreement, TransAlta will purchase the 162MW Mountain Peak Power and 156MW Canyon Peak Power plants, both of which are indirect subsidiaries of Blackstone.
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Mountain Peak Power has been operating since September 2025, while Canyon Peak Power is expected to enter commercial service in the third quarter of 2026 (Q3 2026).
Both assets are under tolling agreements with investment-grade customers for more than 25 years, featuring full pass-through of fuel, operations and maintenance, and capital costs.
The Canada-based energy company said the deal includes the assumption of $750m of senior secured project debt and $250m in equity, which will be funded through a concurrent C$350m bought deal common share offering.
The company predicts that the acquisition will contribute approximately $80m in adjusted earnings before interest, taxes, depreciation and amortisation annually, and free cash flow of around $33m per year, with potential for further increases through availability incentive payments.
TransAlta president and CEO Joel Hunter said: “This acquisition adds new, high-quality, low-risk assets in a core market for us. It strengthens our business risk profile, is immediately accretive to our free cash flow per share and establishes a strategic foothold in Colorado, a state we believe has accelerating growth potential.
“These assets will generate long-term contracted cash flows for redeployment into other growth prospects such as Centralia and Alberta data centres, and I am pleased with the continued meaningful progress on both projects.”
According to TransAlta, the deal is expected to result in immediate low-to-mid single-digit accretion to free cash flow per share.
The planned equity raise involves issuing 18.2 million common shares at C$19.20 per share, underwritten by CIBC Capital Markets and RBC Capital Markets.
The proceeds are intended to fund the cash portion of the asset purchase.
The closing of the share offering is expected on or around 9 June 2026, subject to customary approvals.
Completion of the acquisition is contingent on Canyon Peak Power reaching commercial operation and on customary regulatory approvals.
TransAlta expects to close the purchase early in Q4 2026.
