Reliant Energy has reportedly told its bank group it may cancel the sale of its New York City thermal generation assets in light of the better-than-expected price it got for the recent sale of its upstate New York network of hydroelectric power plants. When Reliant put its Empire State assets under the hammer late last year, it thought it would need to sell both sets of assets, but the $900 million price tag Brascan paid for the hydro plants alone gives Reliant flexibility on whether to continue the auction or hold the New York City plants, said a banker. Bids for the 2,100 MW New York City merchant portfolio were filed last month. Both Empire State sales generated strong interest from the beginning from strategic and financial players alike.
Reliant has not formally canceled the auction, said the banker, but is no longer constrained by the need to sell off the plants quickly and can wait for a sweeter offer or take the assets off the block. The banker guessed that Reliant might bite for a bid in the $1.2-1.4 billion range. A Reliant spokesman declined comment, as did a utility banker at Goldman Sachs, which is advising on the sale.