Asset sales, a restructuring and even a possible sale of the business may be in the cards for NRG Energy (NRG) - Get Report after activist investor Elliott Management's Paul Singer and a private equity partner on Monday reached a settlement with the Houston-based company to add two dissident directors to its board.

Specifically, NRG Energy agreed to add C. John Wilder, the executive chairman of Dallas-based PE firm Bluescape Partners, Elliott Management's partner in the NRG Energy campaign, as well as Barry Smitherman, a former top regulator and investment banker in Texas. The deal will also involve the resignation of two incumbent directors, including the company's chairman, keeping NRG's board's size to 13-members.

Activist investors often seek to have companies set up strategic advisory board subcommittees to help drive their M&A agenda. Such a panel was an essential part of the Elliott settlement, which included the formation of a new board committee to consider "broader strategic alternatives" such as a sale. News of the agreement sent NRG Energy's stock price up 1.5% to $16.90 a share.

The deal comes roughly a month after Elliott launched a public campaign at NRG Energy. The activist fund has been on a tear of late when it comes to driving significant M&A at targeted companies. Cabela's (CA) - Get Report , American Capital, Qlik Technologies, Mentor Graphics and LifeLock, all sold last year under Elliott pressure.

It's possible a sale or major restructuring could be in the cards at NRG Energy as well. As part of the deal, Bluescape's Wilder will become the chairman of the new strategic alternatives committee, which is charged with looking at operational costs, asset sales, capital structure and broader strategic initiatives. The other Elliott-backed director, Smitherman, will also join the panel, which also includesNRG CEO Mauricio Gutierrez and two other directors.

The experience of Bluescape's Wilder may provide some guidance as to what the activist funds may be seeking to achieve at NRG. Before founding Bluescape, Wilder in 2004 became the CEO of TXU an energy company formerly known as Texas Utilities, which he helped turn around with asset sales and cost-cutting, including $1.2 billion in operating cost cuts early on. A 2008 Harvard Business Review case study suggested that shortly before Wilder joined TXU the company was "under severe financial pressure" and its market value had dropped by more than half while its debt load had risen to above 70% of its market capitalization. While at TXU, Wilder cut costs and conducted $15 billion in transactions, eventually selling the business, now known as Energy Future Holdings Corp., to a consortium of private equity firms, including Kohlberg Kravis Roberts (KKR) - Get Report , TPG Capital and Goldman, Sachs (GS) - Get Report , in a 2007 $32 billion deal.

Following the TXU approach, it is possible Bluescape's Wilder will want NRG to streamline its assets, which includes cutting costs, reducing its employee base and potential division sales of non-core assets. The Deal reported in October that NRG's GenOn Energy Inc. unit has an escalating risk of default. NRG also owns a 47% economic interest in NRG Yield (NYLD) , a diversified portfolio of energy assets, including fossil fuel, solar and wind power generation facilities. It's possible that Bluescape's Wilder could seek to have NRG divest or sell these and other non-core assets to simplify the business to make it attractive down the road to private equity buyers.

NRG Yield-C's shares shot up about 1% to $17.75 a share on the news of the settlement, which comes as Brookfield Asset Management Inc. last month entered into exclusive talks to buy bankrupt SunEdison Inc.'s two yieldco's, reportedly valuing the power companies at roughly $2.46 billion.

In the past, Elliott Management has not been afraid of launching director election battles to drive its agenda. The fund is currently engaged in a board proxy battle at Arconic (ARNC) - Get Report . At NRG Energy, the settlement ends the possibility that Singer could launch a director election contest -- for now. With Elliott at the gate, The Deal reported earlier this month that NRG postponed the deadline for nominating dissident directors to Feb. 17 for its 2017 annual meeting, which suggested that a contest was in the works.

Also, The Deal reported that it appeared Elliott had bought the domain names for "fairdealforNRG.com, TransformNRG.com and RepowerNRG.com," another suggestion that the insurgent investors was set to escalate its campaign with a proxy contest and website if the company hadn't responded with the settlement.

As part of the deal, Elliott is prohibited from escalating its activist campaign until after Dec. 31, which means the fund could be back in 2018 with another contest.

Also, another activist fund, Carlson Capital accumulates a 5.4% stake late last month, in a move that likely gave Elliott Management and Bluescape some support with their campaign. Elliott and Bluescape had a combined 9.4% stake, but as part of the settlement they broke up their group.