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Goldman Sachs Group to Buy Renewable Energy Company

Goldman Sachs Group has agreed to acquire Zilkha Renewable Energy, the two companies said on Monday. The transaction is subject to regulatory approvals, is expected to close in the second quarter of 2005 and the sale price was not disclosed.

Zilkha Renewable Energy, owned by the father-and-son team of Selim and Michael Zilkha, is an independent wind energy development company with a portfolio of nearly 4,000 MW in various stages of development in a dozen states.

Goldman Sachs will acquire 100% of Zilkha's interests in the 200 MW Flat Rock Wind Power Project in Lewis County, NY, as well as 100% of Zilkha's interest in the 150 MW Blue Canyon Phase II Project in Oklahoma, both of which are expected to be completed by the end of 2005.

"Goldman Sachs is already a global leader in the energy field, with major positions in traditional energy development, power marketing and commodities trading, and energy finance. Building on our existing portfolio of wind energy assets is a logical extension of our strategy," said Henry Paulson, Jr., Goldman Sachs' CEO. "Goldman Sachs believes that wind and other renewable forms of energy will become an increasingly important part of the world's energy mix, and Goldman Sachs aspires to play a leading role in this high-growth industry."

He said that the acquisition "will allow us to leverage Zilkha's strength in wind energy development with Goldman's expertise and market leadership in energy finance and power marketing. Zilkha has established a reputation for excellence in wind energy development. We intend to build upon that reputation and Zilkha's development pipeline to deliver high-quality projects that meet the needs of customers, partners, landowners and communities."

Michael Zilkha, co-owner and director of Zilkha Renewable Energy, said that Goldman Sachs' acquisition of Zilkha "is a clear sign of wind's emergence as a competitive, efficient, and mainstream energy resource. Because ours is a family-owned company, relationships have always been very important to my father and me. We are maintaining an interest in the new company, and we look forward to a smooth transition to a larger, more integrated enterprise."

"The long-term nature of wind projects places a premium on trust and relationships with customers, suppliers, communities and landowners. We intend to continue that approach. In doing so, we hope to help accelerate the integration of wind generation into the nation's energy supply," Paulson said.

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