NRG Increases Stake in FuelCell With $35 Million Purchase
NRG bought 14.6 million shares of the Danbury, Connecticut-based company for $34.9 million, FuelCell said today in a statement. NRG will also provide a $40 million revolving credit facility to help FuelCell build new power plants in the U.S.
NRG, which got more than 90 percent of its revenue last year from electricity produced from conventional sources, is seeking to expand its clean energy operations. It’s now FuelCell’s second-largest shareholder with about 17 million shares, or six percent of the company. The agreement expands a September co-marketing agreement for NRG to offer fuel cells to its customers, including large energy consumers such as hospitals and universities.
“We believe that clean distributed power generation from fuel cells will be one of the key technologies that drive our country toward a cleaner energy future,” Mauricio Gutierrez, NRG’s chief operating officer, said in the statement. “We want to actively participate in the construction of FuelCell Energy power plants.”
FuelCell’s systems produce electricity from natural gas through a chemical reaction that has less greenhouse gas emissions than power plants that burn gas.
NRG also received a warrant to buy an additional 2 million shares of FuelCell for $3.35 each. The credit line carries an 8.5 percent annual interest rate during the construction of power plants and then 8 percent after the projects are complete.
FuelCell gained 5.1 percent to $2.48 at the close in New York. Its largest shareholder is the South Korean steelmaker Posco.
To contact the reporter on this story: Christopher Martin in New York at firstname.lastname@example.org
To contact the editors responsible for this story: Reed Landberg at email@example.com Will Wade, Jim Efstathiou Jr.