Power company Dynegy (a short version of "dynamic energy") has lost some of its dynamism in recent years, but is looking to get some of that energy back as a reorganized company. Dynegy provides wholesale power, capacity, and other services to a broad range of customers (utilities, cooperatives, municipalities and other energy operations) in six states in the Midwest, the Northeast, and on the West Coast. The company's power generation portfolio consists of a dozen plants fueled by coal, fuel oil, and natural gas, with a total capacity of more than 6,770 MW.
In 2010 Dynegy's board recommended that the debt-heavy company be acquired by Icahn Enterprises for $665 million, but the deal was rejected in 2011, leading Dynegy to file for bankruptcy protection in 2012 from which it emerged that year.
The company provides wholesale power, capacity and ancillary services to utilities, cooperatives, municipalities and other energy companies in six US states in the Midwest, the Northeast and the West Coast.
Dynegy's power generation portfolio consists of approximately 11,600 MW of baseload, intermediate, and peaking power plants fueled by a mix of coal, fuel oil, and natural gas.
Sales and Marketing
Customers include RTOs and ISOs, integrated utilities, municipalities, electric cooperatives, transmission and distribution utilities, industrial customers, power marketers, financial institutions, other power generators, and commercial end-users. In 2012 transactions with MISO accounted for 34% of Dynegy's consolidated revenues; CAISO, 16%; PJM, 15%; NGX, 14%, and NYISO, 13%.
The company's overall revenues decreased by 18% in 2012 due to mark-to-market changes and the closing of its Dynegy North East segment. Gas revenues increased due to higher volumes generated and the more economical operation of gas-power plants, offset by a decrease in coal segment revenues as a result of lower pricing and lower volumes.
In 2012 Dynegy reported a net loss of $139 million (compared to a loss of $1.7 billion in 2011) due to the growth of gas segment revenues.
As part of its 2012 bankruptcy reorganization, the company merged Dynegy Holdings, LLC with and into Dynegy in exchange for the elimination of more than $4 billion in debt and other obligations. It discontinued its Dynegy North East segment (1,700 MW of capacity) in 2012 and sold its Roseton power generation facility near Newburgh, New York, for $19.5 million in 2013.
Dynegy initially had agreed in 2010 to merge with the Blackstone Group in a $4.7 billion transaction, but the deal was rejected by Carl Icahn and other shareholders.
The Blackstone deal offered an opportunity to pay down debt it has piled up after years of expansion. The purchase would have been the largest buyout of a power company by an investment firm since the acquisition of TXU (now Energy Future Holdings) in 2007. However, minority stakeholders Carl Icahn and Seneca Capital opposed the deal, and led a stockholder rejection of the offer, forcing all parties to reconsider their options and leading to the resignation of the company's top executives.
Mergers and Acquisitions
Looking to grow in the Midwest, in 2013 Dynegy acquired Ameren Energy Resources from Ameren. The deal adds 4,119 MW of generation in Illinois.
Franklin Advisers owns 32% of the company; Luminus Management, 10%.