September 6 (Renewables Now) - Canada’s Innergex Renewable Energy Inc (TSE:INE) on Thursday said it has agreed to launch an offering of convertible debentures targeting CAD 125 million (USD 94.7m/EUR 85.8m) to pay existing debt and support development projects.
The renewable power producer, which has almost 2 GW of installed capacity in Canada, the US, France and Chile, will sell convertible unsecured subordinated debentures on a bought deal basis at CAD 1,000 apiece. Bearing an interest of 4.65% per year and maturity on October 31, 2026, they will be offered in all Canadian provinces and possibly in the US.
Funds from the transaction will be used to prepay debt under an existing revolving credit facility so as to finance the redemption of the company’s 4.25% convertible debentures outstanding, finance new projects and other growth opportunities, as well as for general corporate purposes.
The debentures will be convertible at the holder’s option into Innergex’s common shares at a price of CAD 22.90 per share, representing a conversion rate of 43.6681 common shares per CAD 1,000 principal amount of debentures. Interest payments will start on April 30, 2020, while redemption will not be possible before October 31, 2022.
TD Securities Inc, CIBC Capital Markets, BMO Capital Markets and National Bank Financial Inc will be among the underwriters of the deal. They have been granted a 30-day over-allotment option to buy an additional CAD 18.75 million worth of debentures at the same offering price.
A preliminary short form prospectus in Canada will be issued by September 11, 2019, while completion of the offering is expected on or about September 30, 2019.
(CAD 1.0 = USD 0.757/EUR 0.686)