TransAlta to buy 125-MW Australian power station for $318 million

Tue Sep 4, 2012 5:14pm EDT
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(Reuters) - Canadian power producer TransAlta Corp (TA.TO: Quote) said its unit entered into an agreement with Fortescue Metals Group Ltd (FMG.AX: Quote) to buy a 125 megawatt dual-fuel power station in Western Australia for $318 million.

TransAlta also sold 19.3 million common shares for nearly C$275 million ($278.78 million) in connection with the deal.

The 125-MW Solomon power station will be fully contracted with Fortescue under a long-term power purchase agreement.

The under-construction power station will likely be commissioned in the fourth quarter.

TransAlta shares closed at C$14.68 on the Toronto Stock Exchange on Tuesday.

($1 = 0.9865 Canadian dollars)

(Reporting by Shounak Dasgupta in Bangalore)