Log In | Register
Texan takeover may signal changes in the way America generates electricity.
Controversial plans for eight new coal-fired power plants in Texas look likely to be scrapped as part of a proposed buyout of Dallas-based electricity generator TXU Corporation.
The US$45-billion deal that has been announced between TXU and investors led by Kohlberg Kravis Roberts & Co. and Texas Pacific Group goes along with a change in the company's stance on green issues. As well as revising its plans for new power stations, the company will commit itself to cut carbon-dioxide emissions back to 1990 levels by 2020 and adopt strict environmental rules.
If the deal goes ahead it will be the biggest such leveraged buyout — a corporate acquisition financed with loans — in the history of the United States. The team that set it up sought the help of some of the same environmental groups that had previously sued TXU over the company's environmental policies and aggressive expansion plans, which involved 11 new coal-fired power stations.
"This is a watershed moment in America's fight against global warming," says Fred Krupp, president of Environmental Defense, a New York-based environmental group involved in the negotiations.
