Algonquin Power & Utilities is selling its non-hydro renewable-energy business to LS Power for up to $2.5bn (€1.83bn).
The renewables business, mainly consisting of wind and solar assets across the US and Canada, includes 44 operational assets with over 3GW of generating capacity.
It also includes an 8MW pipeline of wind, solar, battery energy storage, and renewable natural gas projects at various stages of development. Around 2.7GW of the portfolio’s assets are based in the US, with the remaining 300MW located in Canada.
Paul Segal, CEO of LS Power, said the acquisition complements LS Power’s existing fleet of more than 19GW of renewable, energy storage, flexible gas and renewable fuels projects.
“We believe this platform will play a significant role in meeting the challenges of rising electric demand and advancing the energy transition.”
Algonquin Power said the acquisition amount comprises a $2.28bn cash payment and up to an additional $220m, contingent on meeting certain performance targets. Excluding the performance-based payments, Algonquin Power expects to receive $1.6bn in cash proceeds after repaying construction financing and accounting for taxes, transaction fees and other closing adjustments.
Chris Huskilson, CEO of Algonquin Power & Utilities, said: “This major milestone, coupled with our previously announced agreement to support the sale of our Atlantica shares, delivers on our plan to transform Algonquin into a pure play regulated utility, optimise our regulated business activities, strengthen our balance sheet, and enhance our quality of earnings.
“We are confident that our path towards a pure play regulated utility supports our objective to create long-term value for our customers and shareholders.”
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