Talen Energy files 8-K/A: financial statements & exhibits
Ex. 99.1 Unaudited Pro Forma Condensed Combined Financial Information
On July 17, 2025, Talen Energy Corporation (“TEC”, “Talen”, or the “Company”), through its wholly owned subsidiary, Talen Generation, LLC, entered into two purchase and sale agreements in contemplation of each other (collectively, the “Purchase Agreements”) with affiliates of Caithness Energy, L.L.C., pursuant to which we agreed to purchase the (i) the Freedom Energy Center, a 1,045 MW (summer rating) natural gas fired combined cycle generation plant located in Luzerne County, Pennsylvania (the “Freedom Acquisition”); and (ii) the Guernsey Power Station, a 1,836 MW (summer rating) natural gas fired combined cycle generation plant located in Guernsey County, Ohio (the “Guernsey Acquisition” and, together with the Freedom Acquisition, the “Acquisitions”). The aggregate purchase price for the Acquisitions was $3.8 billion, in each case as adjusted in accordance with the applicable Purchase Agreement.
On November 25, 2025 (the “Closing Date”), the Company consummated the Acquisitions and related transactions pursuant to the Purchase Agreements (the “Closing”) and acquired all of the issued and outstanding membership interests in (i) Moxie Freedom, LLC, a Delaware limited liability company and (ii) Guernsey Power Holdings, LLC, a Delaware limited liability company (which owns 100% of the membership interests in Guernsey Power Station, LLC, a Delaware limited liability company) (collectively, the “Acquired Entities”).
In connection with the Acquisitions, the Company completed the following financing transactions (“Financing Transactions”):
▪ Unsecured Notes Issuances. In October 2025, issued in private offerings and each at par: (i) $1.4 billion in aggregate principal amount of unsecured notes due 2034 and (ii) $1.3 billion in aggregate principal amount of unsecured notes due 2036 (together, the “Unsecured Notes”). The proceeds of the Unsecured Notes were used, together with the net proceeds of the senior secured term loan B credit facility (as discussed below), to fund the Acquisitions.
▪ Credit Facility Transactions. In November 2025, several financing transactions became effective concurrently with the Closing:
• TLB-3. Drew in full the $1.2 billion senior secured term loan B credit facility (the “TLB-3”), the proceeds of which, together with the proceeds from the unsecured notes, were used to fund the Acquisitions .
• Revolving Credit Facility (the “RCF”). Increased its existing RCF (including its revolving LC capacity) from $700 million to $900 million.
• Letter of Credit Facility (the “LCF”). Upsized its existing $900 million LCF to $1.1 billion and extended the maturity from December 2026 to December 2027.
The following unaudited pro forma condensed combined financial information of Talen, referred to in this section as the pro forma financial information, is presented to illustrate the effects of the Acquisitions and the related Financing Transactions, which are referred to in this section as the pro forma transactions. The unaudited pro forma condensed combined financial information is comprised of an unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025, referred to herein as the pro forma income statement, and accompanying notes, referred to herein as the notes to the pro forma financial statements. The pro forma income statement gives effect to the pro forma transactions, which for purposes of the pro forma financial information include the incurrence of approximately $3.8 billion (net of fees) of aggregate indebtedness under the Financing Transactions, as if they had occurred on January 1, 2025, the first day of Talen’s fiscal year ended December 31, 2025. An unaudited pro forma condensed combined balance sheet as of December 31, 2025 is not presented as the Acquisitions and related Financing Transactions, and the Acquisitions, were fully reflected in Talen’s annual report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on February 26, 2026
The pro forma financial information is based on and should be read in conjunction with the following historical financial statements of Talen, Moxie Freedom, LLC (“Freedom”) and Guernsey Power Holdings, LLC (“Guernsey”):
• Talen’s historical audited consolidated financial statements and related notes for the year ended December 31, 2025, included in Talen’s annual report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026.
• Freedom’s historical unaudited condensed financial statements and related notes for the three and nine months ended September 30, 2025, attached as Exhibit 99.2 to the Form 8-K/A filed with the SEC on February 9, 2026 as an amendment to the Form 8-K originally filed and dated November 25, 2025.
• Guernsey’s historical unaudited condensed consolidated financial statements and related notes for the three and nine months ended September 30, 2025, attached as Exhibit 99.4 to the Form 8-K/A filed with the SEC on February 9, 2026 as an amendment to the Form 8-K originally filed and dated November 25, 2025.
The financial information of Freedom and Guernsey for the period from October 1, 2025 through November 24, 2025 is based on unaudited accounting records of Freedom and Guernsey.
The pro forma financial information has been prepared using the acquisition method of accounting for business combinations under accounting principles generally accepted in the United States, referred to as GAAP, in accordance with Accounting Standards Codifications (ASC) 805, Business Combinations. Under the acquisition method of accounting, the preliminary purchase price is allocated to the underlying tangible and intangible assets to be acquired and liabilities assumed based upon their estimated fair values as of the acquisition date, with any excess purchase price allocated to goodwill. Talen has made a preliminary allocation of the purchase price to the assets acquired and liabilities assumed as of the Closing Date of the Acquisitions based on Talen’s preliminary valuation of the tangible and intangible assets to be acquired and liabilities assumed in the Purchase Agreements using information currently available. Adjustments to the preliminary amounts may be made in subsequent periods, up to one year from the Closing Date, as information necessary to complete the analysis is obtained. The final valuation of assets acquired and liabilities assumed in the Acquisitions may be materially different than the estimated values assumed in the pro forma financial information.
In accordance with Article 11 of Regulation S-X, the pro forma financial information has been prepared for illustrative and informational purposes only and is not intended to represent what Talen’s results of operations or financial position would have been had the Acquisitions occurred on the dates indicated, or what they will be for any future periods or as of any future date. The pro forma financial information does not reflect the realization of any expected cost savings or other synergies or dis-synergies that may be realized as a result of the Acquisitions.
Unaudited Pro Forma Condensed Combined Statement of Operations for the Year ended December 31, 2025
(a) Includes the financial results of Freedom and Guernsey from November 25, 2025 to December 31, 2025.
(b) See the pro forma financial information attached as Exhibit 99.5 to the Form 8-K/A filed with the SEC on February 9, 2026 as an amendment to the Form 8-K originally filed and dated November 25, 2025.
Notes to the Unaudited Pro Forma Financial Information
1. Basis of Presentation The pro forma financial information has been prepared in accordance with Article 11 of SEC Regulation S-X. The Acquisitions are being accounted for as a business combination using the acquisition method of accounting under U.S. GAAP, in accordance with the provisions of ASC 805, Business Combinations, which requires assets acquired and liabilities assumed to be recorded at their acquisition date fair value. ASC 820, Fair Value Measurements, defines the term “fair value” as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” Fair value measurements can be highly subjective, and it is possible the application of reasonable judgment could develop different assumptions resulting in a range of alternative estimates based on the same facts and circumstances.