Innergex Renewable Energy Inc. (TSX: INE) (“Innergex” or the “Corporation”) announces that it has entered into a definitive agreement with Finavera Wind Energy (TSX-V: FVR) to acquire its Wildmare wind energy project located in British Columbia, Canada.
The purchase price of this asset will be approximately $22.0 million, subject to adjustments based on the realization of certain events and milestones. Other than an initial advance of $1.0 million, there will be no disbursement prior to closing, and payments will be spread over several months. Innergex expects the transaction to close by the fall of 2012, subject to regulatory approvals and other customary closing conditions.
“This acquisition marks another milestone for Innergex, as we add our first wind project in British Columbia and expand our wind energy activities outside the province of Quebec”, states Michel Letellier, President and Chief Executive Officer of Innergex. “We are expanding our pipeline of projects under development with power purchase agreements, in order to ensure a sustainable level of growth over the long-term”, he adds.
Wildmare is a wholly-owned wind project located on Crown lands in the Peace River region of British Columbia. All of the power produced will be sold to BC Hydro under a 25-year power purchase agreement, which provides for an annual adjustment to the selling price based on a portion of the Consumer Price Index. Wildmare is expected to have a total installed capacity of 77 MW, an estimated yearly energy output of 238,200 MWh, enough to power almost 24,000 BC households, and is expected to produce revenues of approximately $28.0 million in its first full year of operation. The Corporation believes that this project, which is currently in the permitting phase, should reach commercial operation in 2015, with construction lasting approximately 15 months. During the period prior to the closing of the transaction, the Corporation and Finavera will work together to advance the project through its environmental assessment process and to continue consultation with Finavera’s First Nation partners. The total cost of the project, including the consideration paid to acquire it, is estimated to be $217.0 million, approximately two-thirds of which will be financed with project-level debt and the balance financed with equity.
About Innergex Renewable Energy Inc.
Innergex Renewable Energy Inc. (TSX: INE) is a leading Canadian independent renewable power producer. Active since 1990, the Company develops, owns, and operates run-of-river hydroelectric facilities, wind farms, and solar photovoltaic farms and carries out its operations in Quebec, Ontario, British Columbia, and Idaho, USA. Its portfolio of assets currently consists of: (i) interests in 26 operating facilities with an aggregate net installed capacity of 494 MW (gross 880 MW), including 20 hydroelectric operating facilities, five wind farms, and one solar photovoltaic farm; (ii) interests in 9 projects under development or under construction with an aggregate net installed capacity of 231 MW (gross 374 MW), for which power purchase agreements have been secured; and (iii) prospective projects with an aggregate net capacity totaling 2,904 MW (gross 3,127 MW). Innergex Renewable Energy Inc. is rated BBB- by S&P and BBB (low) by DBRS.
The Corporation’s strategy for building shareholder value is to develop or acquire high-quality facilities generating sustainable cash flows and providing a high return on invested capital, and to distribute a stable dividend.