As discussed here and here, sale of Mirant’s Philippine assets is apparently being driven by investors, particularly the hedge fund Pirate Capital, that are not happy with with management’s $8 billion unsolicited bid to to take over NRG and the low performance of Mirant stock.
This is just one component of several other stockholders’ initiatives to increase share price after they pressured management to scuttle the NRG bid. The financial rationale?
Eliminate a volatile emerging market exposure and transform the company into a pure-play U.S. generator, potentially more attractive to U.S. investors.
Want some IPP valuation benchmarks? From the above links, apparently 8 times EBITDA is about the going valuation of IPPs.
Mirant’s 2200 MW Luzon assets earned $370 million EBITDA in 2005. That yields almost $3 billion sale price or $1,345/kW
For reference: YNN’s $561.7 million Masinloc bid was $936/kW.