Houston-based Calpine Corp., which operates natural gas-fired generation plants around the nation, is being acquired by a consortium of investors led by Energy Capital Partners (ECP) for $5.6 billion.

Once the model merchant gas-fired power plant operator, Calpine would be owned by ECP and a consortium led by Access Industries and the Canada Pension Plan Investment Board. The purchase at $15.25/share in cash represents a 51% premium.

Calpine Chairman Frank Cassidy said the transaction announced Friday is the result of a strategic review process that was unanimously approved by the board. Cassidy said the board had undertaken “an exhaustive review of strategic alternatives” for the independent power producer, formerly a darling of Wall Street.

Calpine would maintain its Houston headquarters and operate under current management. The acquisition is subject to shareholder and various regulatory approvals.

Under new ownership, Calpine would operate “as it always has” for both wholesale and retail power customers, said CEO Thad Hill. The company intends to “continue to strengthen our wholesale power generation footprint while benefiting from ECP’s support, industry expertise and long-term investment horizon.”

The company shot to success in the late 1990s when the power sector was being deregulated, building a network of gas-fired combined-cycle generation plants and later acquiring existing generation, mostly in the gas-fired space.

At the end of 2005, with more than $2 billion of debtor-in-possession financing, Calpine filed for Chapter 11 bankruptcy protection. The company re-emerged in early 2008with a 24,000 MW portfolio and a continuing strategy focused on gas-fired power.

Before the bankruptcy, Calpine’s stock had approached triple-digit levels, but that was before the demise of Enron Corp. and the wholesale power market meltdown in 2001. Calpine at that time had 24 gas-fired power plants under construction and more than 13,000 MW of plants in operation. The company’s growth in power plants continued post-2001, but the growth in profits did not.

In the pre-bankruptcy days, Calpine had pursued a goal of holding gas reserves equaling up to half of its fuel needs. That pursuit crashed in mid-2005 when the company was forced to sell for $1.05 billionits reserves in Texas, Canada and elsewhere.

ECP partner Tyler Reeder said the private equity firm sees “significant value” in “Calpine’s operational excellence and strong, stable cash flows.” He also reiterated that no plans would be made to Calpine’s operations. Calpine’s financial policy will remain the same, too, he said, citing a previously announced plan to reduce overall debt by $2.7 billion.