Boralex becomes the sole owner of 3 Quebec
wind farms, with a 296 MW installed capacity
MONTREAL, Nov. 20, 2020 /CNW Telbec/ - Boralex Inc.
("Boralex" or the "Corporation") (TSX: BLX) is pleased to announce
that it has entered into a definitive agreement to acquire the full
49% equity stake held by the Caisse de dépôt et placement du Québec
("CDPQ") in 3 wind farms in Quebec, already 51% owned by Boralex. CDPQ's
49% equity stake represents 145 MW net installed capacity and the
three wind farms represent a total capacity of 296 MW. Located
in the Avignon RCM in Gaspésie and the Appalaches RCM in eastern
Quebec, these farms are equipped
with Enercon turbines and benefit from long-term power purchase
agreements ("PPAs") with Hydro-Québec Distribution, expiring
between 2032 and 2033 with a weighted average remaining contract
duration of nearly 12.5 years.
"We're very pleased to announce our acquisition of CDPQ's stake
in high-quality wind farms that we already own 51% of and have
managed for over two years following our acquisition of Invenergy's
stakes in these assets. Operating these wind farms provided the
expected synergies and has yielded results 10% better than we had
expected in 2019", says Patrick
Lemaire, Boralex's President and CEO.
"This transaction strengthens our position in the wind industry
in Canada and is perfectly aligned
with the growth orientation of our strategic plan. Acquiring CDPQ's
stake will add significant cash flow for the coming years and a
positive contribution to the company's discretionary cash flow per
share in the first year after the transaction closes. We also
expect to generate additional operational and financial synergies
in the coming years," adds Patrick Decostre, Boralex's Vice
President and Chief Operating Officer.
As part of the acquisition, Boralex will pay a cash
consideration of $121.5 million to
CDPQ on closing, which may be supplemented by a conditional
consideration of up to $4 million
subject to the settlement of certain future conditions that need to
be met. The closing is expected to take place at the end of
November 2020, subject to standard
closing conditions. Following this transaction, Boralex's installed
capacity will be 2,212 MW.
Highlights
- Acquisition price: $121.5 million
in cash payable at closing and an additional amount of up to
$4 million after closing, subject to
the settlement of certain conditions that need to be met;
- Adds 145 MW net power to Boralex's installed capacity;
- Long-term contracts expiring between 2032 and 2033 with an
average remaining duration of almost 12.5 years;
- Additional annual contribution of the wind farms to Boralex's
results:
-
- $31 million to combined EBITDA
representing the acquisition of CDPQ's 49% stake;
- $62 million to EBITDA under IFRS
representing 100% of EBITDA for wind farms that will now be
consolidated in the Corporation's financial statements;
- $10 million or $0.10 per share to discretionary cash flows, an
8% increase over the consolidated amount generated by Boralex in
2019;
- Additional operational and financial synergies expected.
Wind farm description
Des Moulins I wind farm (136 MW) is located in the
Appalaches RCM in Quebec. This
farm has 59 E-82 wind turbines. Des Moulins II wind farm (21
MW) is located in the Avignon RCM in Gaspésie, Quebec. This farm has nine E-92 wind turbines.
Both farms are covered by an existing PPA that expires in
December 2033.
Le Plateau I wind farm (139 MW) is located in the
Avignon RCM in Gaspésie, Quebec.
This park has 60 E-70 E4 wind turbines and is covered by an
existing PPA that expires in March
2032.
Each wind farm is funded on a long-term basis through
consortiums of international financial institutions. Financing
consists of a combination of variable interest rate term loans (a
large portion of which is covered by interest rate swaps) and notes
or fixed rate loans. Project debt as at September 30, 2020, totalled $402 million (the 49% equity stake is therefore
$197 million).
Questions relating to related party transactions
CDPQ
holds approximately 17.28% of the Corporation's issued and
outstanding common shares as at November 20,
2020. The acquisition could be considered a "related party
transaction" under MI 61-101 for the Protection of Minority
Security Holders in Special Transactions (MI 61–101). The
Corporation has availed itself of the exceptions for evaluation and
approval of minority holders in paragraphs 5.5(a) and 5.7(a) in MI
61-101.
The two independent directors representing CDPQ on the Boralex
board of directors did not participate in the discussions on the
acquisition, and they abstained from voting on these matters.
About Boralex
Boralex develops, builds and operates renewable energy
power facilities in Canada,
France, the United Kingdom and the United States. A leader in the Canadian
market and France's largest
independent producer of onshore wind power, the Corporation is
recognized for its solid experience in optimizing its asset base in
four power generation types — wind, hydroelectric, thermal and
solar. Boralex ensures sustainable growth by leveraging the
expertise and diversification developed over 30 years. Boralex's
shares are listed on the Toronto Stock Exchange under the ticker
symbol "BLX".
More information is available
at www.boralex.com or www.sedar.com. Follow us
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Caution Regarding Forward-Looking
Statements
Some of the statements contained in this press release,
including those regarding to the addition to the discretionary cash
flow from the interests acquired, the accretion to discretionary
cash flows per share of Boralex from the interests acquired, the
expected EBITDA contribution from the interests acquired, the
expected additional operational and financial synergies, the
expected closing date of the transaction, the conditional
consideration payable following the closing, the Corporation's
business model and growth strategy are forward-looking statements
based on current expectations, within the meaning of securities
legislation.
The forward-looking statements are based on material
assumptions, including the following: assumptions about the
performance the Corporation will obtain from the interests to be
acquired, based on management's estimates and expectations with
respect to factors related to production and other factors;
assumptions made about EBITDA margins; assumptions made about
the situation in the sector and the economic situation in general,
competition and the availability of financing.
Although Boralex believes that the expectations reflected by the
forward-looking statements presented in this news release are
reasonable, Boralex would like to point out that, by their very
nature, forward-looking statements involve risks and uncertainties
such that its results or the measure it adopts could differ
materially from those indicated by or underlying
these statements, or could have an impact on the degree
of realization of a particular forward
looking statement.
Unless otherwise specified by the Corporation, the
forward-looking statements do not take into account the
possible impact on its activities, transactions, non-recurring
items or other exceptional items announced or occurring after the
statements are made. There can be no assurance as to the
materialization of the results, performance or achievements as
expressed or implied by forward-looking statements. The reader is
cautioned not to place undue reliance on such forward-looking
statements.
Unless required to do so under applicable securities
legislation, Boralex management does not assume any obligation to
update or revise forward-looking statements to reflect new
information, future events or other changes.
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SOURCE Boralex Inc.