* Plans to reduce debt by $13 bln
* To sell stake in yield co
* Shares near 2-yr high of $19.76 (Adds details on the power sector, background)
July 12 (Reuters) - NRG Energy Inc said it would raise as much as $4 billion through asset sales and slash debt by $13 billion, sending its shares surging 21 percent to a near two-year high on Wednesday.
The largest independent U.S. power producer plans to significantly slash costs, as part of an agreement with activist investors Elliott Management and Bluescape Energy Partners to cut costs and reduce debt.
The three-year program intends to achieve "efficiencies primarily in corporate and lower head costs" CEO Mauricio Gutierrez said in a conference call on Wednesday.
In February NRG made a deal with Elliott and private equity firm Bluescape, agreeing to set up a five-member committee to look into cost-cutting, asset sales, capital allocation and broader strategic initiatives.
Elliott and Bluescape together have an 8.2 percent stake in the company, according to Thomson Reuters data.
NRG said it would sell 50-100 percent of its interest in its unit NRG Yield Inc and renewables platform.
NRG Yield had a market valuation of about $3 billion as of Tuesday close. The company's shares were up 3.6 percent at $17.34.
Cheap natural gas flowing from shale fields has brought down electricity prices in recent years, squeezing margins for wholesale power generation companies.
Rival Calpine Corp had debt of $12.2 billion as of Dec. 31 and is rumored to be on the block.
NRG, in comparison, had a debt fair value of $18.6 billion and a carrying value of $19.4 billion during the same period.
The company's shares were up 18 percent. They hit a high of $19.77 in early trading. (Reporting by John Benny in Bengaluru; Editing by Arun Koyyur and Sriraj Kalluvila)