FirstEnergy Generation Names Stalking Horse Bidder For West Lorain Power Plant
FirstEnergy Generation, LLC announced that it has agreed to sell its West Lorain Facility and related assets to Vermillion Power, LLC, an affiliate of Starwood Energy Group Global, LLC ("Starwood"), for a purchase price of $144 million in cash plus customary closing adjustments.
The West Lorain Facility is a 545 MW, periodic-start, combustion-turbine generation station located on 500 acres in Lorain, Ohio near Lake Erie. The West Lorain Facility was constructed in 1973 as a combined-cycle electric generating system with two combustion turbines (Units 1A and 1B), two heat recovery steam generators, and a steam turbine generator. In 2001, five additional combustion turbines were installed (Units 2–6) and placed in operation. The plant currently operates on fuel oil, but is also capable of operating on natural gas.
The sale will be accomplished pursuant to a court-supervised bankruptcy auction process in order to maximize the value of the assets being sold. FirstEnergy Generation has filed a motion with the Bankruptcy Court overseeing its chapter 11 cases for approval of auction and bid procedures that will permit other interested parties to submit competitive bids for the West Lorain Facility and related assets. In the event that no higher or better bids are received by FirstEnergy Generation, Starwood will acquire the business, subject to the satisfaction of customary conditions to closing.
The sale is subject to receipt of customary approvals, including approval of the Federal Energy Regulatory Commission and Hart-Scott-Rodino. If approved, the companies expect to close the transaction in the first half of 2019.