April 18 (Renewables Now) - Canadian renewable energy company Algonquin Power & Utilities (TSX:AQN) is making use of an option to acquire an additional 16.5% stake in Spanish yieldco Atlantica Yield Plc (NASDAQ:AY).
Algonquin Power, which currently holds indirectly a 25% equity interest in Atlantica, said in a statement today it has entered into an agreement to buy the additional stake for about USD 345 million (EUR 278.5m), or USD 20.90 per share.
The completion of the transaction is expected in the second or third quarter of the year, once it secures the necessary governmental approvals.
At the same time, Algonquin Power plans to raise some CAD 445 million (USD 354m/EUR 286m) gross by issuing and selling around 37.5 million common shares at CAD 11.85 apiece to certain institutional investors. It will use the proceeds of the offering to finance the Atlantica transaction and for general corporate purposes. Completion is scheduled for April 24.
"This equity issuance supports APUC's measured international expansion strategy through an accretive incremental investment in Atlantica and largely addresses the common equity required for our 2018 capital investment plan," said CEO Ian Robertson.
(USD 1.0 = EUR 0.808)
(CAD 1.0 = USD 0.795/EUR 0.642)