Cohocton, N.Y. —
Trouble for First Wind doesn’t mean trouble for Cohocton.
Executives at First Wind Holdings Inc. pulled the plug on their initial public offering (IPO) just hours before the company’s stock was due to begin trading on the Nasdaq late last week.
Initially the company wanted to sell roughly 12 million shares in a price range of $24 to $26 each, which would have generated as much as $312 million.
A lowered price range of $18 to $20 was announced before trading began last Thursday, but the company decided to hold off.
“It’s a very bad IPO market right now,” John Lamontagne, director of corporate communications at First Wind, said. “The shares were going to be offered for not what we thought they were worth. The determination we made was that it wasn’t in the company’s best interest to go public.”
He didn’t rule out possibly going public in the future.
“It just didn’t happen this time. I don’t think it’s taken off the table. I don’t think it’s going to happen in the near future,” Lamontagne said. “We’re going to pursue finances for some of our other development projects in other ways. We have a strong track record. We have successfully received over $2 billion worth in finances for various projects. We’re looking forward to moving on, IPO or no IPO.”
But the stumbling block for the wind company doesn’t mean trouble for Cohocton, where 50 First Wind turbines have operated since 2008.
“It has zero impact on our operating projects or projects we have in construction or development,” Lamontagne said. “We’re just continuing on moving forward.”
Town Supervisor Jack Zigenfus admitted to being a little worried when he first heard the news last week, but was reassured that everything was OK after a phone call with First Wind’s vice president.
“It was a business decision made. It has absolutely no bearing on our project or our situation as far as the town,” Zigenfus said. “Their decision with the IPO was to raise money for further growth, etc. Projects that are funded now are fully funded by investment banks.”
The town recently adopted its 2011 budget, with the tax levy remaining unchanged from last year – at $2.85 per thousand dollars of assessed property value.
The town relies heavily on the wind project, Zigenfus said. Prior to the turbines coming to Cohocton, the tax levy was $4.18 in 2007.
This year the town received $725,000 as part of the community host payment, and $100,000 of that will be used to repair roads. The rest will go into the general fund.
“If we didn’t have the wind project, we’d probably be in very tough shape,” Zigenfus said. “Other than raising taxes, I don’t know where the next money would have come from. The town is in very, very good financial shape for next year and the next few years.”
Currently, Cohocton and First Wind have agreed to a 20-year project, which began in 2008. The town has the option of renewing that pact once it concludes.
“I don’t see any financial issues with the town. We’ve gotten everything up to par, the roads, the sidewalks, all of those things,” Zigenfus said. “We’ve spent a lot of the money to make an impact and put it to good use. Now we’re making sure we have reserves. We’re going to wisely invest the money so we’re well protected.”
The town supervisor has no complaints about the wind project.
“Everything, as far as I can see, seems to be running smoothly,” he said. “You get the occasional complaint. You’re always going to get that. Most of them are always the same people.
“Our budget is largely based on that income from wind,” Zigenfus said, adding that the wind project might be the town’s largest industry ever. “I’m very pleased with our finances.”
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