TransAlta Renewables has acquired economic interest in three renewable assets including 50MW Lakeswind Wind Farm in Minnesota, 21MW of solar projects located in Massachusetts and 20MW Kent Breeze Wind Farm located in Ontario. from its parent company TransAlta Corp.
The total purchase price for the three assets, which have an average weighted contract life of 15 years, is $166m, including the assumption of $62m of tax equity obligations and project debt.
The equity value of $104m represents a 10x multiple of CAFD and is expected to be accretive on a per share basis. TransAlta Renewables will fund the equity value portion of the acquisition using existing liquidity.
TransAlta Renewables president John Kousinioris said: “The acquired assets are a natural fit for TransAlta Renewables which focuses on diversified, highly contracted cash flows from strong counterparties.
“These drop-downs, along with the two recent US wind projects, demonstrate our ability to execute on accretive, renewable acquisitions.”
Concurrent with the acquisition, the Board of Directors of TransAlta Renewables has approved the implementation of a dividend reinvestment plan (DRIP) for Canadian holders of common shares of TransAlta Renewables.
Commencing with the dividend payable on July 31, 2018, to shareholders of record at the close of business on July 13, 2018, eligible shareholders may elect to automatically reinvest monthly dividends into additional common shares of TransAlta Renewables.
The price for common shares purchased under the DRIP will be 98% of the average market price of the common shares for the five trading days on which not less than 500 common shares of the Company are traded immediately prior to the dividend payment date. Common shares acquired under the DRIP will be issued from the treasury of TransAlta Renewables.
Eligible shareholders are not required to participate in the DRIP. Those shareholders who have not elected to participate in the DRIP will continue to receive their monthly cash dividends in the usual manner.
TransAlta Corporation, which holds 64% of the outstanding shares of TransAlta Renewables, does not intend to participate in the DRIP.
This news release provides a summary of some of the terms of the DRIP. The DRIP defines the terms and conditions of the DRIP and the rights of eligible participants in the DRIP.
Interested shareholders are encouraged to review the full text of the DRIP. This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities.
A complete copy of the DRIP, together with a related series of Questions and Answers, are available on TransAlta Renewables website at www.transaltarenewables.com or can be obtained by calling AST Trust Company, TransAlta Renewables transfer agent at: 1-800-387-0825.
In addition, the Company also declared monthly dividends of $0.07833 per share for holders of record on July 13, 2018, August 15, 2018 and September 14, 2018 payable on each of July 31, 2018, August 31, 2018 and September 28, 2018, respectively.
Source: Company Press Release