"The acquisition will enable Arise to maintain the high pace of expansion that we have been planning for. We are now shifting a large share of our resources to the Jädraås project, which fits in well time-wise with other ongoing permit processes in our project portfolio. Platina is a valuable and knowledgeable partner, and we hope to develop this relationship also in other projects. When the Jädraås wind farm is fully operational in spring 2013 Arise will have a total annual production of about 650 GWh of renewable electricity," Peter Nygren, CEO of Arise Windpower, says.
"The Jädraås project is the first project for Platina to enter into construction in Sweden. Constructing this project with Arise enables us to benefit from the experience of a leading onshore wind developer in the Swedish market. We are anticipating that this is the first of several investments as we build out platform in Sweden," Mikael Schoultz, Partner, Platina Partner LLP, says.
JVAB is owned in equal shares by Ownpower Projects Europe AB ("OPP") and Bergviks Skog ("Bergvik").
The consideration for JVAB is SEK 250 million, including development expenditure incurred for the project. Arise will fund its portion of the acquisition through a combination of cash and 2,500,000 shares that will be allocated to OPP at a discount of 5 per cent, which is consistent with normal market terms. Of these, 1,574,500 will be new shares and the remaining 925,500 will be treasury shares currently held by Arise. Treasury shares do not give rise to dilution, as they are included in the total number of outstanding shares in the company before the issue of new shares. The total number of shares and votes in Arise after the issue will be 33,428,070, representing a dilution of 4.7 per cent. The issue of new shares, in the form of a private placement, will be made under the resolution adopted at the general meeting of shareholders on 27 April 2011 authorising the Board of Directors of Arise to decide one the issuance of shares. The decision will result in increase in the share capital of Arise from SEK 2,548,285.60 to SEK 2,674,245.60. After the transaction OPP will have a stake in Arise representing 7.5 per cent of the total outstanding number of shares.
"We are very pleased that the deal has been sealed and that we will now become one of the major shareholders of Arise. We believe strongly in wind power and that it has a natural part to play in our power supply, and in Arise Windpower’s ability to generate good long-term returns for its owners," Jonas Dahlström, CEO of OPP, says.
The total investment in the Jädraås project including the acquisition and erection of 66 Vestas V112 turbines is SEK 3.1 billion. The investment is fully funded through equity and bank financing and is expected to meet Arise Windpower’s required rate of return by a comfortable margin. DnB NOR acted as Financial Adviser to Arise and Platina for the arrangement of debt financing which will be provided through a consortium consisting of DnB NOR, SEB and the Danish export credit agency EKF. Main suppliers to the project are Vestas, NCC, Vattenfall and ABB.
In addition, to the shares of the profit in JVAB, Arise will also receive compensation for its development activities in the Jädraås project. This will improve the profit of Arise Windpower with 5 M? before tax during the fiscal years 2011 to 2013.