Mirant withdraws objection over $5 million break-up fee for Perryville auction

By Jeff Pines

Washington, Feb. 26 - Mirant Corp, which earlier this week objected to the $5 million break-up fee for Perryville Energy Holdings, LLC's auction, withdrew it.

In a filing with the U.S. Bankruptcy Court for the Western District of Louisiana, Alexandria Division, Mirant waived its right to appear at the hearing on bidding procedures scheduled for March 2.

Perryville's stalking horse bidder is Entergy Louisiana, Inc., which is bidding $170 million for Perryville's 718-megawatt power plant.

Perryville filed for Chapter 11 after it was unable to reach terms acceptable to its lenders on the sale to Entergy. Before the filing, it was in default on its $133 million loan as a result of an agreement with Mirant Americas Energy Marketing LP. Mirant agreed to provide natural gas to the Perryville plant.

The plant would convert the gas into electricity for a fee and then provide Mirant with the electricity created from the fuel. When Mirant filed for bankruptcy on July 14, it threw Perryville's loan into default.

Mirant did not say why it withdrew its limited objection, and as of press time, a company spokesman was not able to comment on the reason.

Perryville's Chapter 11 case number is 04-80109.

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