Canadian power producer TransAlta Corp said on Wednesday it will acquire two natural gas-fired peaking facilities near Denver, Colorado, from Blackstone for about $1 billion, strengthening its presence in the Western U.S. power market.
Power producers are adding flexible gas-fired capacity to support rising demand, as the industry prepares for a rapid growth in electricity consumption, partly driven by power-hungry data centers.
The assets, Mountain Peak Power and Canyon Peak Power, have a combined capacity of 318 megawatts and are fully contracted under long-term tolling agreements with investment-grade customers for more than 25 years. The deal includes assuming $750 million of project-level debt and raising about $250 million in equity through a C$350 million bought deal share offering.
Under the offering, a syndicate of underwriters led by CIBC Capital Markets and RBC Capital Markets will buy 18.2 million shares at C$19.20 each.
The facilities are expected to generate about $80 million in annual adjusted core profit and roughly $33 million in free cash flow, with additional upside from performance incentives.
“These assets will generate long-term contracted cash flows for redeployment into other growth prospects such as Centralia and Alberta data centres,” CEO Joel Hunter said.
TransAlta said the deal will be immediately add to free cash flow per share in the low-to-mid single digits.
The transaction is expected to close in early fourth-quarter 2026, subject to the completion of the Canyon Peak facility, which is set to begin operations in the third quarter.
(Reporting by Sumit Saha in Bengaluru; Editing by Arun Koyyur)