v3.26.1
Acquisitions
 6 Months Ended
Jun. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Acquisitions Acquisitions
Cardinal Portfolio Acquisition — On March 30, 2026, the Company, through its indirect subsidiaries, Cardinal Purchaser LLC and Cardinal JV Purchaser LLC, completed the acquisition of the Cardinal Portfolio, a 610 MW portfolio of operational solar facilities located in eight states, for net cash consideration of $322 million, which includes post-closing adjustments of $2 million. Of the net consideration, $242 million related to facilities consolidated by the Company and $80 million related to facilities held through a joint venture with a third-party investor. The joint venture includes 12 facilities located in the western U.S., comprising 225 MW. The Company’s investment in the joint venture is accounted for under the equity method, as further described in Note 4, Investments Accounted for by the Equity Method and Variable Interest Entities. The Cardinal Portfolio has a weighted average remaining contract duration of approximately 10 years. The Cardinal Portfolio is reflected in the Renewables & Storage segment and the acquisition was funded with $100 million in borrowings under the new financing arrangement entered into in connection with the acquisition, as further described in Note 7, Long-term Debt, as well as existing sources of liquidity. After factoring in cash acquired, transaction expenses and proceeds from the related financing activities, the Company estimates its net capital investment in the Cardinal Portfolio will be approximately $240 million.
The Company accounted for the consolidated group of facilities acquired by Cardinal Purchaser LLC as a business combination under ASC 805, Business Combinations, or ASC 805. The following table presents the preliminary fair value estimates of the assets acquired and liabilities assumed by Cardinal Purchaser LLC as of the acquisition date:
(In millions)
Cardinal Portfolio (a)
Cash$1 
Restricted cash15 
Property, plant and equipment314 
Intangible assets for power purchase agreements128 
Right-of-use assets 62 
Derivative assets6 
Other current and non-current assets24 
Total assets acquired550 
Long-term debt (b)
180 
Long-term lease liabilities39 
Other current liabilities3 
Other non-current liabilities84 
Total liabilities assumed306 
Noncontrolling interest (c)
2 
Net assets acquired$242 
(a) Excludes the equity method investment held by Cardinal JV Purchaser LLC.
(b) See Note 7, Long-term Debt, for additional information regarding the assumed facility-level debt.
(c) Represents a tax equity fund, Shoreham Energy Holdings, LLC, which the Company consolidates as primary beneficiary. The Class A membership interests in Shoreham Energy Holdings, LLC are held by a tax equity investor.
In accordance with ASC 805, the assets acquired and liabilities assumed have been measured at fair value as of the acquisition date. The fair value of property, plant and equipment was determined primarily based on the income approach using discounted cash flows. This methodology was utilized as the forecasted cash flows incorporate specific attributes including age, useful life, equipment condition and technology. The fair value of intangible assets and liabilities for power purchase agreements was determined utilizing a variation of the income approach determined by discounting the replacement market price of the incremental cash flows associated with the contracts to present value. Intangible liabilities for power purchase agreements are included in other non-current liabilities. Primary assumptions utilized included estimates of generation, contractual prices, operating expenses and the weighted average cost of capital reflective of a market participant. These assumptions are considered to be a Level 3 measurement as defined in ASC 820, Fair Value Measurement, as they utilize inputs that are not observable in the market. Long-term debt assumed as part of the acquisition was recorded at its estimated fair value as of the acquisition date.
The fair value measurement of the acquired assets, assumed liabilities and noncontrolling interests above remain preliminary. The Company expects to finalize the fair value estimates within the measurement period, which will not exceed one year from the acquisition date.
For the period from March 30, 2026 through June 30, 2026, the consolidated facilities contributed operating revenues of $22 million and net income of $7 million to the Company’s consolidated results.
The following unaudited pro forma financial information presents the consolidated results of operations of the Company as if the business combination had occurred on January 1, 2025:
Three months ended June 30,Six months ended June 30,
(In millions)2026202520262025
Operating revenues$481 $409 $846 $722 
Net income (loss)28 19 (46)(85)
The pro forma information includes adjustments to reflect the Company’s accounting policies and the impact of fair value adjustments to the consolidated facilities’ property, plant, and equipment, intangible assets and long-term debt.