BKV Acquires Majority Stake in BKV-BPP Power Joint Venture to Accelerate Growth Strategy
BKV Corporation (NYSE: BKV), a leading U.S.-based sustainable energy company, has announced a definitive purchase agreement with Banpu Power US Corporation (BPPUS) to acquire one-half of BPPUS’s ownership interest in BKV-BPP Power, LLC (the “Power JV”). Upon closing, BKV will hold a 75% ownership stake in the joint venture, expanding its control and influence over one of the company’s most strategic assets in the power generation space.
This transaction represents a major step forward in BKV’s long-term “closed-loop” energy strategy — a vertically integrated model that connects natural gas production with lower-emission power generation and carbon capture solutions. By consolidating ownership in BKV-BPP Power, the company strengthens its ability to capture synergies across its energy value chain and position itself for growth amid rising electricity demand.
Strengthening Strategic Control and Expanding Opportunities
BKV’s expanded ownership in BKV-BPP Power reflects its increasing confidence in the long-term fundamentals of the independent power producer (IPP) market, particularly in the Electric Reliability Council of Texas (ERCOT) region. Texas continues to experience surging electricity demand driven by rapid population growth, industrial expansion, and the rise of energy-intensive applications such as artificial intelligence (AI) and data centers — especially in the ERCOT North zone.
Through this acquisition, BKV will gain majority control over the Power JV’s Temple I and Temple II power plants — highly efficient natural gas combined-cycle facilities located near Temple, Texas. The plants provide flexible and reliable generation capacity, ideally suited to support both the increasing volatility of renewable generation and the growing need for grid stability.
Chris Kalnin, Chief Executive Officer of BKV, stated:
“We are pleased to have reached an agreement with BPPUS to acquire the majority stake of the Power JV, enhancing our strategic flexibility and accelerating the potential growth in our power business. The IPP market is fundamental to our long-term growth strategy, and our vision is for a single, clean platform to operate, build, and acquire power assets. Increasing our equity stake and assuming majority control of the joint venture strengthens our ability to fully capitalize on opportunities in a key strategic growth market, driving substantial long-term value for our shareholders.”
Financial and Structural Details of the Transaction
Under the terms of the agreement, BKV will pay total consideration calculated as $376 million less 25% of the Power JV’s net indebtedness at closing, which will be paid 50% in cash and 50% in BKV common stock. As of September 30, 2025, BKV-BPP Power had approximately $581.8 million in net debt. The stock portion of the payment will be issued at a fixed price of $21.6609 per share.
BKV plans to fund the cash portion of the purchase using a mix of existing cash reserves and borrowings under its reserve-based lending (RBL) facility. Following its successful high-yield bond issuance earlier in 2025, the company reported $800 million in available borrowing capacity under its RBL credit agreement — positioning it well to finance strategic growth initiatives without straining its balance sheet.
Upon completion, BKV will consolidate BKV-BPP Power’s financial results within its corporate accounts. This consolidation will improve financial transparency, offering investors a clearer view of the company’s recurring cash flows and the contribution of the power segment to its overall portfolio value.
Advancing BKV’s Integrated Energy Vision
The acquisition marks a significant milestone in BKV’s ongoing transition from a traditional upstream natural gas producer to a diversified energy platform combining power generation, carbon capture, and sustainable fuel solutions. With greater control over the Temple facilities, BKV aims to:
- Enhance operational reliability and efficiency of the Temple I and II plants.
- Unlock new commercial opportunities through power trading, grid services, and potential integration with carbon capture systems.
- Align governance and decision-making with BKV’s broader energy transition goals.
- Create a streamlined platform for future expansion through additional power asset acquisitions or greenfield development.
BKV’s closed-loop energy strategy seeks to utilize its natural gas production as a feedstock for low-carbon power generation, complemented by carbon capture, utilization, and storage (CCUS) technologies. This integrated model is designed to minimize emissions while maximizing energy value — positioning BKV as a differentiated player in the evolving North American energy landscape.
Governance, Approvals, and Timeline
The transaction was carefully structured and reviewed to ensure transparency and fairness. A Special Committee of independent and disinterested BKV directors oversaw the process, supported by independent financial and legal advisors. The Special Committee’s recommendation led to full board approval of the deal.
On the partner side, the board of directors of Banpu Power Public Company Limited (BPP) — the parent of BPPUS and a listed company on the Stock Exchange of Thailand — also approved the transaction and agreed to seek shareholder authorization. The proposal will be submitted for a vote at an Extraordinary General Meeting (EGM) of BPP shareholders, with approval requiring at least 75% of votes from disinterested shareholders in attendance. The EGM process follows Thai corporate governance and connected-transaction regulations, and an independent financial advisor will provide an assessment to shareholders before the vote.
Banpu North America Corporation, which holds a majority of BKV’s outstanding common stock, has already consented to the issuance of BKV shares for this transaction. Consequently, BKV will not need to solicit additional shareholder approval for the equity portion of the deal.
Pending customary closing conditions and regulatory clearances, BKV expects the transaction to close in the first quarter of 2026.
Advisors and Counsel
BKV was represented by Baker Botts L.L.P. as legal counsel. The Special Committee retained Morris, Nichols, Arsht & Tunnell LLP as independent legal counsel and Moelis & Company LLC as independent financial advisor to evaluate the transaction and ensure fair value for minority shareholders.
A Strategic Milestone for Long-Term Growth
With this acquisition, BKV strengthens its foundation as a vertically integrated energy company capable of spanning the natural gas, power, and low-carbon value chains. The move not only enhances operational control and financial transparency but also positions BKV to capture the accelerating demand for reliable and cleaner power generation in key U.S. markets.
As the energy transition reshapes how power is produced and consumed, BKV’s strategy — anchored in efficiency, sustainability, and integration — is set to deliver long-term value for both shareholders and the broader energy ecosystem.
By taking majority ownership of BKV-BPP Power, BKV demonstrates its commitment to building a resilient and scalable power platform that will play a vital role in meeting tomorrow’s energy needs while advancing decarbonization goals.
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