NRG Energy Inc (NYSE:NRG) To Dispose $4B In Assets


NRG Energy Inc (NYSE:NRG) announced on Wednesday that it plans to dispose assets worth $4 billion in the next three years as part of its strategy to cut costs as revealed by Mauricio Gutierrez.

NRG has been building towards a plan to restructure its business since February though the official announcement came on Tuesday. The company plans to sell a significant portfolio, including the 45 gigawatts renewable power assets in the U.S. NRG intends to sell assets worth as much as $4 billion from its gas, coal, wind and solar portfolio. The company plans to dispose GenOn which it acquired in 2012 and is now bankrupt. The disposal will also include 15 gigawatts of its gas and coal plants.

“We’re looking at the entire package. You should think about the development company, the operating company, and the yield as an integral part of the proposition that we have in the market,” stated Mauricio Gutierrez, the CEO of NRG Energy.

Gutierrez also added that the disposal of the renewable assets might also include the power plants that are currently in operation or those that are still in development. The announcement did not reveal further details of the specific projects. However, they will come to be revealed along the road when the actual sale takes place. It is however clear that NRG plans to sell all its stake in YieldCo and NRG Yield while 50 to 100 percent of the remaining operating renewable assets will be divested.

Gutierrez also revealed that his company has already kicked off the sale process with Morgan Stanley (NYSE:MS) and Goldman Sachs Group Inc (NYSE:GS) as advisors on the sale. The divestment process by the end of this year though the restructuring process is expected to continue for the next three years. The three-year restructuring plan was developed by a special committee and it covers long-term cost-cutting measures worth more than $640 million. They include power plant job cuts, design, and maintenance among others.

According to Gutierrez, the restructuring plan will place the company on top of the list of the lowest-cost generators on the market.

NRG stock closed the latest trading session on Wednesday at $21.09.

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