Pomona Energy Storage facility, California.
Image by AltaGas.
US geothermal company Ormat Technologies Inc (NYSE:ORA) today said it has priced a bond issue worth ILS 1 billion (USD 289m/EUR 258m), the proceeds from which will be used to finance an energy storage project acquisition.
The bonds are issued in Israeli shekels to investors outside the US and will be converted to US dollars using a cross-currency swap transaction. Before the swap, the bonds will carry a fixed annual interest rate of 3.35% and after the swap the rate is expected to be 4.35%. The bonds will mature in June 2031.
The bond issue is expected to close in the first week of July.
Some USD 47 million out of the proceeds from the bond sale will be used for the acquisition of the 20-MW/80-MWh Ponoma energy storage facility from Canadian utility Altagas Ltd (TSE:ALA). The plant, located in California, has been operational since 2017 and is said to be one of the largest battery storage facilities in North America.
The rest of the proceeds will be used to repay debt and back Ormat's growth plans.