Houston's Dynegy buys LS Power

HOUSTON, Sept. 15 (UPI) -- Dynegy Inc. and LS Power Group, a privately held U.S. power plant investor, developer and manager, are merging to form a major power generation group.

LS Power will receive 340 million shares of Dynegy common stock plus $100 million in cash and a $275 million Dynegy Inc. note. The combined entity will also assume about $1.8 billion in net debt from LS Power.

The $2.3 billion transaction will create a combined company with more than 20,000 megawatts comprised of 31 power plants in 15 states. U.S. assets will be concentrated in the Midwest, Northeast and West.

LS Power will have a 40-percent stake in the newly expanded Dynegy.