Canadian renewable power producer Innergex Renewable Energy Inc (TSE:INE) has agreed to buy the 50% it does not already own in Chilean sector player Energia Llaima SpA in an all-stock deal worth CAD 88.36 million (USD 71.2m/EUR 60.1m).
The two companies became joint venture partners in the summer of 2018 after Innergex bought an initial 50% stake in the Chilean firm. "Innergex is now ready to pursue its growth on its own in the Chilean and larger Latin America market," the Canadian firm’s CEO Michel Letellier said in a press release on Wednesday.
The acquisition, aimed to bring operational synergies to Innergex, will add 83.4 MW to its installed capacity. Energia Llaima has interests in three hydropower plants (HPPs) in Chile totalling 152 MW and a 34-MW solar thermal facility. It also has several projects in the development or prospective stages.
To take full control of Energia Llaima, Innergex will issue common stock worth USD 71.35 million to the Chilean firm’s shareholders. Canadian utility Hydro Quebec, which owns a preferential subscription right for a 19.9% ownership in Energia Llaima, will be able to subscribe for Innergex common stock.
Innergex estimates that the acquisition will add USD 14.9 million to its revenues proportionate and USD 8 million to its adjusted earnings, before interest, tax, depreciation and amortisation (EBITDA) on a proportionate basis per year in the first full five years. It also expects the transaction to expand its free cash flow by USD 3.6 million.
(CAD 1.0 = USD 0.806/EUR 0.681)
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