NRG Energy Launches 3-Year Plan

NRG Energy said Wednesday it has launched its three-part, three-year “transformation plan,” designed to significantly strengthen earnings and cost competitiveness, lower risk and volatility, and create significant shareholder value, by selling some assets, paying down debt and strategically investing excess cash.

With respect to asset sales and the strategic alternatives process, NRG said it expects to announce signed agreements during Q4 of 2017. NRG has engaged Citi, Goldman Sachs and Morgan Stanley for certain asset sale processes that it said are well underway. “Importantly, the majority of targets and results are achievable by the end of 2018,” the company said in a press release, “providing investors and the company with clear line of sight to results.” The plan intends to make $1.07 billion in recurring cost and margin Improvements, including $855 million in recurring annual free cash flow before growth accretive improvements; $210 million in permanent SG&A reduction from asset sales and divestments; $2.5 billion-$4.0 billion targeted asset sale net cash proceeds, plus
removal of $13 billion in total debt from its balance sheet.

By Caroline Williams