Dominion agrees price for USGen assets

Virginia-based energy producer Dominion looks set to acquire three power plants from Maryland-based USGen New England for $656 million. However, an auction process is due to take place before the deal closes to ensure no other bidders are willing to top the offer.

Dominion is offering $536 million in cash plus an adjustment for inventory and reimbursement of certain capital expenditures incurred prior to closing, estimated at $120 million.

The plants comprise 2,839 megawatts (MW) of coal, natural gas and oil generating capacity, and would increase Dominion's total capacity by 10%. The planned sale is part of a bankruptcy court-supervised divestiture of USGen's fossil fuel assets, and is expected to close in March 2005.

But first the generating assets