Boralex Inc. has completed the acquisition of all of the economic interests of Invenergy Renewables LLC in five wind farms in Québec (the “projects”), totaling 201 MW of net installed capacity, for a total cash consideration of $215 million. The agreement is subject to post-closing adjustments to the purchase price under the acquisition agreements.
Located in the MRC d’Avignon and the MRC des Appalaches in Eastern Québec, the projects were commissioned between March 2012 and December 2016. They comprise state-of-the-art Enercon and GE turbines. The projects benefit from long-term Power Purchase Agreements (PPAs) with Hydro-Québec Distribution expiring between 2032 and 2041.
The acquisition is expected to strengthen Boralex’s position in the Canadian renewable energy sector and is consistent with the corporation’s proven acquisition strategy. The acquisition adds 201 MW of clean energy to Boralex’s asset portfolio, increasing the corporation’s net installed capacity by nearly 12% to 1,820 MW while extending its portfolio’s weighted average PPA term to 14 years.
“This acquisition highlights the strength of our acquisition capabilities in this competitive marketplace where Boralex captures operational synergies,” said Patrick Lemaire, President and Chief Executive Officer at Boralex. “This acquisition contributes to our objective of sustainable and predictable cash flow growth for our investors while supporting the generation of electricity derived from renewable energy for thousands of homes in Québec.”
Boralex becomes the new manager of the sites by assuming the facilities management agreements currently in place and as such will manage the day-to-day business and affairs of the Projects which will immediately provide additional operating cash flows and is also expected over time to lead to increased operational synergies for Boralex as a whole.
All required approvals and consents for the Acquisition, including from the Competition Bureau of Canada, Hydro-Québec and the lenders under the credit agreements for the Projects, were obtained prior to the closing of the acquisition.
The community partners holding the remaining interests in two of the projects (Le Plateau II and Roncevaux) also waived their rights of first offer to acquire Invenergy’s economic interests. The aggregate cash consideration for the acquisition of $215 million was financed using the net proceeds from the corporation’s previously announced $207 million public bought deal offering of subscription receipts completed through a syndicate of underwriters and a $51.8 million concurrent private placement of subscription receipts with the Caisse de dépôt et placement du Québec.
With the closing of the acquisition now effective, each subscription receipt will be exchanged for one common share in the capital of the corporation (each, a “Common Share”) without additional consideration and without further action by the holders of subscription receipts. Holders of subscription receipts will also be entitled to receive a cash amount for each subscription receipt equivalent to the dividend payable on or about September 18, 2018 to holders of record of Common Shares as of August 31, 2018.