The Faber Report

Dynegy Energy Acquired By Blackstone


The Blackstone Group will acquire Dynegy and take the company private.


It's not really a leveraged buyout (LBO), but more of a LBOJV, meaning a combination leveraged buyout/joint venture transaction.

Earlier this week Dynegy was down 22 percent, but now the stock will be up very sharply with the $4.50 per share in cash deal from Blackstone, which represents a 62 percent premium to the closing share price on August 12. The total value of the deal is $4.7 billion—this includes existing debt.

Faber Report

At one time the name Dynegy meant a multi-billion dollar market cap company, one that competed with the likes of Enron. Prior to Enron imploding, Dynegy was in a deal to buy some of the company.

Dynegy does have a "go-shop" of 40 days to solicit alternative proposals, which more than likely won't mean anything.

Also, in a separate deal with Blackstone, NRG Energy will acquire four of Dynegy's natural gas assets.

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