25 Billion Wiped Out from 'AI Power Stocks'... Major Acquisition Leads to Sharp Decline

Independent U.S. power producer Talen Energy Corporation (TLN) saw its shares tumble 11.32% on the Nasdaq to close at $371.82 on January 16, roughly 550,000 Korean won. In a single day, its market capitalization fell by about $1.7 billion (around 2.5 trillion won), bringing its total valuation down to roughly $17 billion (25 trillion won).

The previous day, shares had jumped more than 11% after the company announced a deal to acquire approximately 2.6 GW of gas-fired power plants in Ohio and Indiana for $3.45 billion. However, concerns over rising leverage and shareholder dilution drove today’s sell-off when it became clear that $2.55 billion of the purchase price would be financed with new debt and that the company would issue $900 million of additional shares. Nonetheless, some institutional investors—most notably private equity firm Thames Capital Management—stepped in, purchasing about $5.89 million worth of new TLN shares on the same day.

Talen Energy is an independent power producer operating roughly 10.7 GW of gas, coal, and nuclear generation and storage assets, primarily in the U.S. Mid-Atlantic and Montana regions, and supplying electricity to wholesale markets. The company has secured a long-term contract to deliver about 1.9 GW of carbon-neutral power from its Susquehanna nuclear plant to Amazon data centers. Its large-scale acquisition strategy aimed at serving the growing power needs of AI data centers has recently earned it the “AI power stock” moniker on Wall Street.