FERC approves power plant sale deal involving Blackstone Group

The Federal Energy Regulatory Commission on May 6 approved a deal involving changes in ownership for power plants in various states, including Montana and Colorado.

On April 1, Tanner Street Generation LLC and Bicent Power LLC, on behalf of its public utility subsidiaries, filed an application requesting authorization for the disposition of jurisdictional facilities that will result from: the transfer of 100% of the direct membership interests in Tanner Street Generation from EDF Trading Holdings LLC to Bicent Power (called the “TSG Transaction”); and the associated transfer of additional membership interests in Bicent Power to investment funds managed or advised by GSO Capital Partners LP and investment funds and accounts under the control and management of Strategic Value Partners LLC, via a rights offering to all members of Bicent Power (called the “Rights Offering”).

Tanner Street Generation owns and operates a nominal 82-MW dual-fuel combined-cycle power plant located in Lowell, Massachusetts. Tanner Street Generation is a wholly-owned direct subsidiary of EDF Trading, which in turn is a wholly-owned indirect subsidiary of Électricité de France SA.

Bicent Power owns 100% of the Bicent Project Companies, which are public utilities that own and operate the following facilities:

  • BIV Generation Co. LLC, which owns and operates a 123-MW natural gas-fired facility located near Brush, Colorado.
  • Colorado Power Partners, which owns and operates a 55-MW (nameplate) natural gas-fired facility and a 24-MW natural gas-fired facility, which are located near Brush, Colorado.
  • Rocky Mountain Power LLC, which owns and operates a 115.7-MW facility located in Hardin, Montana.
  • San Joaquin Cogen LLC, which owns and operates a 48-MW facility located in Lathrop, California.

Bicent Power is currently owned by GSO (approximately 66.9%) and Strategic Value Partners (approximately 19.9%). Applicants assert that each of the remaining owners of Bicent Power holds less than 10% of the outstanding voting interests in Bicent Power and does not otherwise control Bicent Power.

GSO represents the credit-oriented business of the Blackstone Group LP and is a major participant in the leveraged finance markets. Blackstone is a global alternative asset manager and provider of financial advisory services.

  • Under the TSG Transaction, pursuant to a purchase and sale agreement, applicants state that EDF Trading will transfer 100% of the direct membership interests in Tanner Street Generation to Bicent Power. Consequently, Tanner Street Generation will be a wholly-owned direct subsidiary of Bicent Power, and neither EDF Trading nor EDF SA will hold any ownership interest in Tanner Street Generation following consummation of the TSG Transaction.
  • In connection with the TSG Transaction, Bicent Power intends to issue additional membership units of Bicent Power to finance the TSG Transaction as well as its ongoing working capital needs, via the Rights Offering. Under the Rights Offering, all members of Bicent Power will have the right to subscribe for new units in accordance with their existing pro rata ownership. Applicants note that GSO has agreed to acquire all undersubscribed units of members that do not exercise their rights to participate in the Rights Offering.
About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.