China Huaneng Group, the nation’s largest electricity producer, is buying a 50 percent stake in Massachusetts-based power utility InterGen for $1.23 billion.
GMR Group will sell the stake to Huaneng in a transaction expected to close in the first half of 2011, the Indian company said in a statement today.
Huaneng, based in Beijing, will gain access to 12 power plants in the U.K., Netherlands, Mexico, Australia and the Philippines in its biggest overseas acquisition in two years.
InterGen’s overseas holding company has $1 billion in debt, and the sale will release $225 million equity that can be used for its projects, GMR Chairman G.M. Rao said.
Bangalore-based GMR bought its share of InterGen for $1.1 billion in October 2008 from a fund owned by American International Group Inc. The rest of the power utility is owned by the Ontario Teachers’ Pension Plan.
Bank of America Corp. and White & Case LLP acted as financial advisers and legal counsels to GMR, the company said.
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