The transaction is expected to provide value to Reliant Energy for its equity interest in the project as well as resolve the bankruptcy proceedings that began in August 2007 when four subsidiaries related to the Channelview plant filed for Chapter 11 bankruptcy protection.
Proceeds from the sale will be used to settle the claims of secured creditors, including approximately $379 million of debt, accrued interest and make-whole payments as of January 31, 2008; the claims of unsecured creditors (approximately $29 million as of January 31, 2008); and a cash-sharing agreement. Residual proceeds will be retained by Reliant.
