Finavera is dumping its BC Wind projects portfolio, including the Tumbler Ridge Wind Project Portfolio.
The company has had a rough go of it over the last few years, and has been actively pursuing all options, from simple financing to selling off the whole company. A few months ago, the company announced it was selling off one of its BC projects, but a few months later, that sale was cancelled and the entire company was put on the auction block.
Now Finavera’s Special Committee of the Board has recommended and approved the signing of an agreement with Pattern Renewable Holdings Canada for the sale of the Company’s 300 megawatt (MW) wind project portfolio for approximately $40 million.
Finavera Wind Energy CEO Jason Bak says “This transaction is a testament to the quality of our portfolio and is an excellent example of the monetization of value created through our development skill set. The transaction indicates a significant difference between our market capitalization and our inherent value as in addition to the $40 million in proceeds payable on the projects proceeding to construction, Finavera maintains a 10 percent interest in the 105 MW Cloosh Valley Wind Project and is expecting an additional $9.3 million payment from the project in 2013. With the cash proceeds that will be received by Finavera from these transactions, we will be well-positioned to continue to pursue further high growth opportunities in renewable power development.”
Under the terms of the agreement, Pattern has agreed to refinance up to $9 million of corporate debt, fund certain development costs going forward and provide a further debt facility to the Company at a rate of 10 percent, which will be applied against the purchase price.
Post-acquisition, Pattern has also committed to development spending on the near term projects. Approximately $11 million will be paid to Finavera upon shareholder approval and on the completion of the acquisition of the project companies with the balance of $40 million being proportionally payable upon all projects proceeding into construction and obtaining construction financing.
For now, Pattern is focusing on finishing up the sale, and don’t have any specifics to offer on when the Tumbler Ridge Wind Project might start construction. However, CEO Mike Garland says, “We are very excited about this project and we look forward to getting to know the people of the community and one day becoming a vital part of that community.”
Pattern is a US company, though it has a Canadian arm as well. It is, according to their website, “one of North America’s leading independent wind and transmission companies. We have projects totaling over 1,155 MW in operation and under construction. In addition, we are growing and building on our current development pipeline, which includes over 3,000 MW of wind power and multiple transmission projects in the United States, Canada and Latin America.”
The agreement is subject to approval from shareholders and the TSX Venture Exchange.
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