Finavera Wind Energy Signs Agreement for $40 million sale of British Columbia Wind Project Portfolio
VANCOUVER, Dec. 20, 2012 /PRNewswire/ - Finavera Wind Energy Inc. ('Finavera Wind Energy', 'Finavera' or the 'Company') (TSX-V: FVR) is pleased to announce that after a thorough review of a number of corporate transaction options and numerous proposals from interested parties, Finavera's Special Committee of the Board has recommended and approved the signing of an agreement with Pattern Renewable Holdings Canada ULC, a subsidiary of Pattern Energy Group LP, ('Pattern') for the sale of the Company's 300 megawatt (MW) British Columbia wind project portfolio for approximately $40 million. The agreement provides the best value for shareholders after the review of a number of different deal structures, assessment of execution risk and the potential for future value.
Finavera Wind Energy CEO Jason Bak said, "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% 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%, all of which will be applied against the purchase price at closing of the acquisition of the projects. 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. The agreement is subject to approval from shareholders and the TSX Venture Exchange.
Bak adds, "We are pleased to have Pattern as a partner in this transaction given their depth of experience and financial ability. Finavera is confident in Pattern's ability to move these projects forward to construction and to honour the commitments that were made to project stakeholders during their development."
Further information will be provided to shareholders in advance of a meeting to be held by or before March 30th, 2013.
Jason Bak, CEO
About Finavera Wind Energy Inc. (www.finavera.com)
Finavera Wind Energy is a company focused on developing, constructing and operating wind farms in North America and Ireland. Our mission is to create and operate a diversified portfolio of wind projects while protecting and enhancing the physical and social environment. In British Columbia, Canada, four projects totaling 300 MW have been awarded 25 year AAA-rated Electricity Purchase Agreements and one has received full environmental approval and permitting for construction, expected to begin in 2013. In Ireland, the Company has signed a partnership agreement with SSE plc for development of the 105MW Cloosh Valley Wind Project. Finavera is continuing to opportunistically review prospects for growth and the enhancement of shareholder value.
Statements in this news release, other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, constitute Forward-looking statements. The words "would", "will", "expected" and "estimated" or other similar words and phrases are intended to identify forward-looking information. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the Company's actual results, level of activity, performance or achievements to be materially different than those expressed or implied by such forward-looking information. Such factors include, but are not limited to: uncertainties related to the ability to raise sufficient capital, changes in economic conditions or financial markets, litigation, legislative or other judicial, regulatory and political competitive developments and technological or operational difficulties. Consequently, actual results may vary materially from those described in the forward-looking statements.
"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."
SOURCE Finavera Wind Energy Inc.