Calpine to Acquire Noble Americas Energy Solutions, for $1 billion

HOUSTON, TX -- Houston-based Calpine Corporation has announced plans in a press release on Sunday to purchase Noble Americas Energy Solutions, LLC for a purchase price of $800 million plus an estimated $100 million of net working capital at closing.

The Houston Business Journal reports that the deal is expected to be completed by the end of 2016.

“We are excited to be acquiring the best commercial and industrial direct energy sales platform in the U.S. The acquisition of this well-regarded organization known for providing sophisticated customers with highly customized products is a natural fit with Calpine’s customer-centric culture and will allow us to build upon the success we have experienced since our entry into retail last year through the Champion Energy platform,” said Thad Hill, Calpine’s President and Chief Executive Officer.

Hill said the deal allows Calpine to the company’s retail customer sales channels and product offerings, which will increase the volume of retail load.

Noble Americas is the nation’s largest independent supplier of power to commercial and industrial retail customers in 18 states nationwide, including California, Texas, the Mid-Atlantic and Northeastern United States, where Calpine’s wholesale power generation fleet is primarily concentrated.

Noble Americas will remain headquartered in San Diego and will continue to operate under the leadership of Jim Wood, President of NAES.

“We are thrilled to be joining the Calpine team,” said Wood. “Our customers should know that we will continue to provide the same high level of services and product offerings during the ownership transition and, when under the Calpine banner, we expect to provide even greater value-added products and services.”

Calpine expects to fund the acquisition with a combination of cash on hand and temporary bridge loan financing of up to $550 million.

The company intends to repay the bridge facility during 2017 with proceeds from announced asset sales as well as cash from operations, including that generated from the anticipated collateral synergies.

Under Calpine ownership, anticipated collateral needs are expected to be met with approximately $240 million in letters of credit and $20 million of surety bonds, leaving almost $1.2 billion of Calpine Corporate Revolver capacity remaining at closing.

In July, Calpine announced plans to close a 31-year-old power plant in Pasadena near Houston. Over the past year, Calpine made some noteworthy acquisitions, including buying a power plant near Boston for $500 million and another Houston-based electricity provider for $240 million.
Calpine is the Houston area’s 23rd-largest public company, based on its 2015 revenue of $6.47 billion, according to Houston Business Journal research.

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