UPDATE 2-Atlantic Power abandons plans to sell itself; shares slump

Tue Sep 16, 2014 2:06pm EDT
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* Removes chief executive

* Slashes annual dividend by 70 pct

* Says looking to cut expenses by about $7 mln annually

* Toronto, U.S.-listed shares fall more than 30 pct (Adds details, background, analyst quotes; updates share)

By Shubhankar Chakravorty

Sept 16 (Reuters) - Shares of Atlantic Power Corp fell by about a third on Tuesday after the struggling utility removed its chief executive and decided against selling itself.

Faced with mounting debts in a volatile power market, the company also slashed its annual dividend by 70 percent, the second time since February 2013 that it has cut the dividend.

Boston-based Atlantic Power has been caught between falling demand in a volatile wholesale power market and a recovery in the price of the natural gas that feeds its plants in several U.S. states and Canadian provinces.

Several utilities have been selling assets to lower their exposure to this market. Duke Energy Corp agreed last month to sell its non-regulated Midwest commercial generation business to Dynegy Inc for $2.8 billion.   Continued...