Houston-based Dynegy is to be acquired by an affiliate of private equity firm Blackstone Group in a $542 million deal that includes billions in debt assumption. Under a separate agreement between Blackstone and NRG Energy, NRG Energy could acquire four natural gas-fired assets owned by Dynegy for about $1.36 billion.

NRG would acquire the Casco Bay facility in Maine and the Moss Landing, Morro Bay and Oakland facilities in California. The consummation of the merger transaction between Dynegy and Blackstone—valued at $4.8 billion with debt assumption–is contingent upon the concurrent closing of the Blackstone and NRG Energy transaction, Dynegy said. The deal is expected to close by the end of 2010.

Under the terms of the merger agreement, Dynegy stockholders will receive $4.50 in cash for each outstanding share of Dynegy common stock they own, which represents a 62% premium to the closing share price on August 12, 2010. The proposed transaction would provide stockholders with a “significant premium” over the current stock price, Dynegy CEO Bruce Williamson said in a statement.

Dynegy last year sold nine developing plants—many which were coal-fired–to former development partner LS Power. Friday’s news of the generator’s acquisition comes amid a series of similar transactions, most recently, Calpine Corp.’s takeover of Pepco Holdings for $1.63 billion after adjustments. That deal  includes Conectiv’s electric generation business consisting of 19 power plants, including one under construction, with a total generating capacity of 4,490 MW located in five Mid-Atlantic states in the PJM market.

Constellation Energy last week offered $1.1 billion for Boston Generating’s New England power generating fleet. The plants, part of the third-largest power-generating portfolio in New England, are capable of producing 2,950 megawatts, enough power for about 2.4 million homes. The price values the plants at about $372/kW, according to a statement from Constellation Energy.

On Friday, NRG said its bid to purchase the four Dynegy plants—a combined capacity of 3,884-MW—was valued at $351/kW. NRG said it had also agreed, in a separate transaction, to acquire the Cottonwood Generating Station, (a 1,279-MW natural gas-fueled plant) in the Entergy zone of east Texas, from Kelson Limited Partnership for $525 million, or $410/kW.

“We’ve sought for many years to fill the gap in our combined cycle gas portfolio in our core
markets,’’ said David Crane, President and CEO of NRG Energy. “With these acquisitions of ideally located assets, we are filling that gap in three of our four core regions while furthering our longstanding strategy of being a regionally focused, multi-fuel scale generator with the ability to dispatch our assets efficiently across the merit order in each of our core markets.”

 Sources: Dynegy, NRG Energy, POWERnews