Power producer Dynegy Inc. on Friday said it plans to dissolve a development joint venture with LS Power Associates LP, due to constrained credit markets and economic uncertainty.
Dynegy will record an undisclosed loss in 2009 related to the transaction while LS Power will receive about $19 million in cash during the first quarter to reflect the relative value of assets exchanged.
The two companies agreed to the dissolution and that Dynegy will acquire exclusive rights, ownership and developmental control of all repowering or expansion opportunities related to its existing portfolio of operation assets.
LS Power will acquire full ownership and developmental rights associated with various "greenfield" projects under consideration in Arkansas, Georgia, Iowa, Michigan and Nevada, as well as other power generation and transmission development projects not related to Dynegy's existing operating portfolio of assets.
"Today, the development of new generation is increasingly marked by barriers to entry including external credit and regulatory factors that make development much more uncertain," said Bruce Williamson, Dynegy's chief executive.
"In light of these market circumstances, Dynegy has elected to focus development activities and investments around our own portfolio where we control the option to develop and can manage the costs being incurred more closely."Click here for previous GPB News coverage of this developing story.
(AP)
