PPL Corp. (NYSE: PPL) said PPL Generation LLC, its generation subsidiary, agreed to acquire AES Ironwood L.L.C. and AES Prescott L.L.C., which together own and operate the 705 MW AES Ironwood combined-cycle natural gas-fired power plant in Lebanon, Pa., from a subsidiary of AES Corp (NYSE: AES).
PPL said the total consideration for the transaction is approximately $304 million, consisting of a cash purchase price of $87 million, which includes $4.8 million in expected working capital, and approximately $217 million of net project indebtedness of AES Ironwood L.L.C.
The plant began operation in 2001, and for the past four years PPL EnergyPlus LLC, the marketing and trading subsidiary of PPL, has supplied natural gas for the operation of the plant in return for securing its full output under a tolling agreement that expires in 2021.
The sale is expected to close in the second quarter of 2012 following the receipt of necessary regulatory approvals and third-party consents.
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