Canadian power producer Capital Power Corp (TSE:CPX) has agreed to acquire the 100.5-MW Buckthorn wind farm in Texas for up to USD 69 million (EUR 61.9m).
The purchase price for the power plant will range between USD 60 million and USD 69 million, depending on the realisation of future market performance and entering into a tax equity partnership with a balance of USD 68 million. Capital Power will use 100% debt financing for the deal, it said on Monday.
The vendor is UK infrastructure investor John Laing Group Plc (LON:JLG). The latter announced the deal in a separate bourse filing without providing financial details. This will be its second divestment in the US, it added.
Located in Erath County, the Buckthorn wind park uses 29 Vestas turbines that were switched on in January 2018. It operates under a 20-year contract for difference (CfD) for 55% of its production and a 13-year financial hedge arrangement for the remaining 45% of the output.
The wind park has a tax equity investor that receives the tax benefits and a portion of the adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) and cash flow until the flip-date. After this date, in the late 2020s, the average annual adjusted EBITDA and AFFO are seen at USD 9 million and USD 6 million, respectively, based on a purchase price of USD 60 million.
The acquisition is pending regulatory clearance and customary closing conditions and is expected to be finalised in the second quarter. After purchasing the power plant, Capital Power will become its operating manager, taking over the role from Vestas Wind Systems (CPH:VWS). The switch is expected to be made in early 2021.
(USD 1.0 = EUR 0.897)
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