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Business planning: New Jersey company buys aging power plant

Footprint Power, LLC, a New Jersey-based company, has just finalized a deal to buy an aging power plant already scheduled for closure in 2014. According to the plant's seller, Dominion Energy, Inc., the plant is being closed due to its age and increasingly expensive environmental regulations. Footprint Power's business planning provides for the demolition of the current facility when it closes in 2014, and the building of a smaller, more efficient plant in its place.

The plant will remain in operation until its scheduled closure in 2014. At that time, the plant, which is a coal- and oil-fired plant, will be replaced with a gas-fired plant. Footprint Power has also been working closely with the city of Salem where the plant is located, and the International Brotherhood of Electrical Workers Local 326, which represents many of the plant's current workers.

The city of Salem is pleased with the deal since the city will still be receiving tax dollars from the site and will be reclaiming waterfront property that it has not had access to for many years. The union is happy since Footprint Power will be keeping a certain portion of the current workers to help with the demolition of the current site and is working to retrain workers for the gas-fired plant. Then there is the fact that Dominion Energy, Inc. is able to unload an asset they can no longer maintain.

Careful business planning on the part of New Jersey-based Footprint Power, LLC has made this deal a win-win situation for all of the parties involved. Anytime a company is looking to significantly change or to acquire a new business or asset, careful planning is required. Being sure to "cover all of the bases" before closing the deal will ensure that everything goes as smoothly as possible.

Source: The Boston Globe, "Deal to sell Salem power plant closes; new gas plant and development planned," Dan Adams, Aug. 7, 2012

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