NRG Energy, Inc., a leading American energy company, announced on May 12, 2025, a definitive agreement to acquire power generation assets from LS Power in a transaction valued at $12 billion. The deal comprises $6.4 billion in cash, $2.8 billion in stock, and the assumption of $3.2 billion in net debt. This acquisition includes 18 natural gas-fired facilities totaling 13 gigawatts (GW) of capacity, along with a virtual power plant, effectively doubling NRG's total generation capacity to 25 GW.

The strategic move positions NRG to capitalize on the anticipated surge in electricity demand driven by advancements in artificial intelligence, cryptocurrency data centers, and increased electrification in heating and transportation sectors. NRG's CEO, Larry Coben, described the current landscape as the beginning of a "power demand supercycle."

The transaction is expected to close in the first quarter of 2026 and is projected to be immediately accretive to earnings per share, raising NRG’s long-term EPS growth forecast from 10% to 14%. Additionally, NRG will benefit from approximately $400 million in tax advantages resulting from the deal. As of March 31, NRG's long-term net debt stood at $9.81 billion. Following the announcement, NRG shares rose more than 6% in premarket trading.

NRG Energy, headquartered in Houston, Texas, operates a diverse portfolio of power-generating facilities, including natural gas, coal, oil, and renewable energy sources. The company serves over 7 million retail customers across 24 U.S. states and eight Canadian provinces. LS Power, founded in 1990, is an independent power company that owns, operates, and develops power-generating stations, storage facilities, and transmission lines across the United States, with a focus on both traditional and renewable energy projects.

The acquisition encompasses 18 natural gas-fired power plants with a combined capacity of 13 GW, primarily located in key markets such as the Northeast and Texas. Additionally, the deal includes a virtual power plant, which integrates multiple resources to provide power to the grid, enhancing NRG's ability to manage and dispatch electricity efficiently.

The financial structure of the transaction involves a $6.4 billion cash payment, $2.8 billion in NRG stock issued to LS Power, and the assumption of $3.2 billion in net debt. NRG anticipates approximately $400 million in tax benefits from the acquisition, further strengthening its financial position.

This acquisition is a strategic move by NRG to position itself advantageously in anticipation of a significant increase in electricity demand. Factors contributing to this anticipated surge include advancements in artificial intelligence (AI), the proliferation of AI technologies requiring substantial computational power, leading to increased energy consumption by data centers; cryptocurrency data centers, with mining and transaction processing being energy-intensive processes; and the electrification of heating and transportation, with the shift towards electric vehicles and electric heating solutions expected to drive up electricity consumption in residential and commercial sectors.

NRG's CEO, Larry Coben, characterized the current period as the beginning of a "power demand supercycle," indicating a prolonged phase of escalating electricity demand.

The acquisition is projected to be immediately accretive to NRG's earnings per share (EPS). Consequently, the company has revised its long-term EPS growth forecast from 10% to 14%. As of March 31, 2025, NRG's long-term net debt ... . Following the announcement of the acquisition, NRG's stock experienced a positive market reaction, with shares rising more than 6% in ... trading.

NRG has a history of strategic acquisitions to bolster its generation capacity and market presence. This acquisition of LS Power's assets is one of the largest in recent years, reflecting NRG's commitment to expanding its portfolio in response to evolving market dynamics.

This comprehensive overview provides a detailed foundation for understanding NRG Energy's recent acquisition and its broader implications within the energy sector.