Vistra Adds to its Industry-Leading Generation Portfolio with Acquisition of Cogentrix

Core Viewpoint - Vistra Corp. has announced the acquisition of Cogentrix Energy, which includes 10 natural gas generation facilities with a total capacity of approximately 5,500 MW, for a net purchase price of around $4.0 billion [2][3]. Acquisition Details - The acquisition consists of three combined cycle gas turbine facilities and two combustion turbine facilities in PJM, four combined cycle gas turbine facilities in ISO New England, and one cogeneration facility in ERCOT [2]. - The net purchase price includes approximately $2.3 billion in cash, $0.9 billion in Vistra stock (5 million shares at $185 per share), and the assumption of $1.5 billion in outstanding debt, offset by $0.7 billion in expected tax benefits [3]. Financial Implications - The acquisition implies a multiple of approximately 7.25x the expected Adjusted EBITDA contribution for 2027 and about $730 per kW for the portfolio [3]. - It is expected to deliver mid-single digit Ongoing Operations Adjusted Free Cash Flow per share accretion in 2027 and high single-digit accretion on average from 2027 to 2029 [6]. Strategic Rationale - The acquisition enhances Vistra's generation capabilities and diversifies its geographic footprint, adding capacity in key regions such as PJM, ISO New England, and ERCOT [13]. - The Cogentrix portfolio is characterized by modern and efficient gas assets, with an average heat rate of approximately 7,800 Btu/kWh, which complements Vistra's existing fleet [13]. Conditions and Timing - The transaction is subject to regulatory approvals, including from the Federal Energy Regulatory Commission and the Department of Justice, and is expected to close in mid-to-late 2026 [9]. Advisors - Goldman Sachs & Co. LLC is serving as the exclusive financial advisor for Vistra, while Evercore is the exclusive financial advisor for Cogentrix Energy [10].