Talen Energy's $3.5 Billion Power Plant Acquisition Boosts AI Data Center Capabilities

Talen Energy shares soar to all-time high on prospect of data center deals

July 18 (Reuters) - Shares of Talen Energy (TLN.O), opens new tab jumped more than 23% on Friday to a record high, a day after the power producer announced deals worth $3.5 billion to buy two gas-fired plants as it looks to meet growing power demand from data centers. Talen on Thursday said it will buy the Moxie Freedom Energy Center in Pennsylvania from Caithness Energy and the Guernsey Power Station in Ohio from Caithness Energy and BlackRock. Brokerage UBS said the deals allow Talen to "extend the runway" of assets they can leverage as power demand surges from data centers used for artificial intelligence technologies. Gas-fired plants remain a critical bridge in the U.S. energy transition, providing dependable and dispatchable power at scale. The deals give Talen "new flexibility to capitalize on robust data center contracting demand," and may help increase its valuation, J.P. Morgan said. CEO Mac McFarland said Thursday's deals add "more than the equivalent" of another Susquehanna plant to the company's platform. Jefferies analysts expect the transactions to increase potential for data center deals. The average buying price of the two plants is about 53% of the cost of building new turbines, according to analysts at brokerage Evercore ISI. "Buy over build continues the momentum," they said. BofA analysts said the larger fleet lets Talen take up more load and still retain grid resources. Talen said the two plants, which add nearly 3 gigawatts of capacity, are among the most efficient in the PJM Interconnection, a regional transmission organization that manages the flow of wholesale electricity in parts of the Eastern United States, stretching from Illinois to New Jersey. The deals are expected to bolster Talen Energy's 2026 adjusted core profit by more than 40% and boost its free cash flow by 40% in 2026 and over 50% through 2029. Reporting by Arunima Kumar and Pooja Menon in Bengaluru; Editing by Sahal Muhammed Our Standards: The Thomson Reuters Trust Principles., opens new tab

Talen Energy shares surge on $3.5 billion gas-fired power plant deals

July 18 (Reuters) - Shares of Talen Energy (TLN.O), opens new tab jumped more than 15% on Friday in premarket trading, a day after the power producer announced deals worth $3.5 billion to buy two gas-fired plants. The utility company on Thursday said it will buy the Moxie Freedom Energy Center in Pennsylvania from Caithness Energy and the Guernsey Power Station in Ohio from Caithness Energy and BlackRock. Brokerage UBS said the deals allow Talen to "extend the runway" of assets they can leverage as power demand surges from data centers used for artificial intelligence technologies. Gas-fired plants remain a critical bridge in the U.S. energy transition, providing dependable and dispatchable power at scale. The deals give Talen "new flexibility to capitalize on robust data center contracting demand," and may help increase its valuation, J.P. Morgan said. Last month, Talen had announced a partnership with Amazon.com to supply up to 1,920 megawatts of electricity from its Susquehanna nuclear plant in Pennsylvania to Amazon Web Services data centers. CEO Mac McFarland said Thursday's deals add "more than the equivalent" of another Susquehanna plant to the company's platform. The average buying price of the two plants is about 53% of the cost of buying new turbines, according to analysts at brokerage Evercore. "Buy over build continues the momentum," they said. Talen said the two plants, which add nearly 3 gigawatts of capacity, are among the most efficient in the PJM Interconnection, a regional transmission organization that manages the flow of wholesale electricity in parts of the Eastern United States, stretching from Illinois to New Jersey. The deals are expected to bolster Talen Energy's 2026 adjusted core profit by more than 40% and boost its free cash flow by 40% in 2026 and over 50% through 2029. Reporting by Arunima Kumar and Pooja Menon in Bengaluru; Editing by Sahal Muhammed Our Standards: The Thomson Reuters Trust Principles., opens new tab

Talen Energy Stock Soars Over 20% on Purchase of 2 Plants in AI Power Move

The news sent shares of Talen Energy up over 20% to a record high in recent trading. Talen Energy (TLN) shares soared to an all-time high Friday after the energy provider said it's buying two natural gas-powered plants for $3.5 billion, in a move to meet growing demand to support AI data centers. The stock was up over 20% in recent trading above $326, on track to close at an all-time high, after setting an intraday record at $330.18 earlier in the session. The deal gives Talen the Moxie Freedom Energy Center in Pennsylvania, owned by private energy producer Caithness Energy, and the Guernsey Power Station in Ohio, co-owned by Caithness and BlackRock (BLK). Talen said the acquisition boosts its portfolio, and "enhances Talen's ability to offer reliable, scalable, grid-supported and regionally diverse low-carbon capacity to hyperscale data centers and large commercial off-takers." Talen noted that the deal is expected to be "immediately accretive to free cash flow per share by over 40% in 2026, and over 50% through 2029." The move also comes just days after President Donald Trump attended a summit in Pennsylvania, where he announced a $92 billion commitment to support growth of AI data centers and the energy sources to supply them. Jefferies analysts on Friday raised their price target on Talen stock to $380 from $326, with the analysts calling it a "highly accretive & strategic acquisition." With Friday's gains, Talen shares have added over 60% this year so far.

Talen Energy shares surge 17% on $3.5 billion gas-fired power plant deals

Shares of Talen Energy jumped more than 15% on Friday in premarket trading, a day after the power producer announced deals worth $3.5 billion to buy two gas-fired plants. Shares of Talen Energy jumped more than 15% on Friday in premarket trading, a day after the power producer announced deals worth $3.5 billion to buy two gas-fired plants. The utility company on Thursday said it will buy the Moxie Freedom Energy Center in Pennsylvania from Caithness Energy and the Guernsey Power Station in Ohio from Caithness Energy and BlackRock. Brokerage UBS said the deals allow Talen to "extend the runway" of assets they can leverage as power demand surges from data centers used for artificial intelligence technologies. Gas-fired plants remain a critical bridge in the U.S. energy transition, providing dependable and dispatchable power at scale. The deals give Talen "new flexibility to capitalize on robust data center contracting demand," and may help increase its valuation, J.P. Morgan said. Last month, Talen had announced a partnership with Amazon.com to supply up to 1,920 megawatts of electricity from its Susquehanna nuclear plant in Pennsylvania to Amazon Web Services data centers. CEO Mac McFarland said Thursday's deals add "more than the equivalent" of another Susquehanna plant to the company's platform. The average buying price of the two plants is about 53% of the cost of buying new turbines, according to analysts at brokerage Evercore. "Buy over build continues the momentum," they said. Talen said the two plants, which add nearly 3 gigawatts of capacity, are among the most efficient in the PJM Interconnection, a regional transmission organization that manages the flow of wholesale electricity in parts of the Eastern United States, stretching from Illinois to New Jersey. The deals are expected to bolster Talen Energy's 2026 adjusted core profit by more than 40% and boost its free cash flow by 40% in 2026 and over 50% through 2029.