UPDATE 1-U.S. power producer Calpine to sell 6 plants for $1.57 bln

(Corrects fourth paragraph to say the divesture will reduce, not add to, EBITDA and adjusted free cash flow)

April 18 (Reuters) - U.S. power company Calpine Corp said it will sell six power plants in the U.S. Southeast to LS Power for $1.57 billion in cash to focus on the wholesale power markets and better align its asset base.

The power plants together generated about 3.5 gigawatts of capacity in Oklahoma, Louisiana, Alabama, Florida and South Carolina.

With none of the plants restricted to any project debt, Calpine expects the deal to result in net cash proceeds of about $1.53 billion.

The company said the divesture is expected to reduce its adjusted earnings before interest, taxes, depreciation and amortization by $100 million and cut its adjusted free cash flow by about $70 million in 2014.

"Today's announcement represents substantial progress toward the achievement of one of our top strategic priorities - the monetization of our Southeast portfolio," Chief Executive Jack Fusco said.

Following Friday's sale, Calpine will retain ownership of four natural gas-fired power plants in the Southeast totaling 1,738 megawatt capacity in Arkansas, Alabama and Florida.

The company said it will seek opportunities to monetize these assets.

Friday's deal is expected to close in the second quarter of 2014.

As part of deal, LS Power has agreed not to trade in Calpine's stock until the close of the transaction.

(Reporting By Kanika Sikka in Bangalore; Editing by Marguerita Choy)