Texas power company TXU Corp said today it would be acquired by a group led by private equity firms Kohlberg Kravis Roberts & Co. and Texas Pacific Group for $31.8 billion.
In what will be the largest leveraged buyout in history, the investor group will pay $69.25 per share for TXU , a 15.4 per cent premium over TXU 's closing stock price of $60.02 on Friday.
GS Capital Partners, Lehman Brothers, Citigroup and Morgan Stanley intend to be equity investors at closing, TXU said.
Under the deal, a privatised TXU will implement 10 per cent price decreases for residential customers and strengthen environmental policies, TXU said.
The number of planned coal-fuelled generation units will be cut to three from 11, which represents a 75 per cent reduction in new coal capacity.
The company will be reorganised into three independently operated businesses: generation, transmission and distribution, and retail.