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Boralex to acquire stakes in seven US solar projects

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Boralex’s subsidiary, Boralex US Solar CIA, has entered into binding agreements with Centaurus Renewable Energy (CRE) and other investors to acquire their controlling interests in seven solar plants, located in the United States, for a purchase price of $216.5 million.

CRE and other investors will retain certain non-controlling interests in the assets resulting in total net installed capacity to Boralex of 118 MWac.

The operating solar plants totaling 209 MWac of gross installed capacity, located in the City of Five Points, the City of Huron, Kettleman City, the City of Lancaster and the City of Newman, California; Chambers County, Alabama; and Indianapolis, Indiana, were commissioned between 2014 and 2017.

The assets benefit from long-term Power Purchase Agreements (PPAs) with the Regents of the University of California, Alabama Power Company, PG&E, Southern California Edison, City of Palo Alto, and Indianapolis Power & Light, expiring between 2029 and 2046 with a remaining weighted average of more than 21.5 years on the PPAs.

Closing of the transaction is currently anticipated to occur on or before December 31, 2020, subject to the satisfaction of usual closing conditions, including receipt of FERC approval for the Lafayette and Five Points assets.

The PPA of the Lafayette asset contains a right of first refusal in favor of Alabama Power, pursuant to which the CRE interest in Lafayette can be acquired by Alabama Power within sixty days of being notified of a third party binding offer by matching the proposed purchase price.

The acquisition of the interest in this specific asset is therefore subject to the waiver or expiry of this right.

“The acquisition of Centaurus’ interest in seven solar plants will mark Boralex’s entry into the California, Alabama, and Indiana markets. The acquisition of interests in these high quality assets secured by long term contracts is perfectly aligned with the growth and diversification orientations of our 2023 strategic plan. We are extremely pleased with the stable stream of cash flow and strong growth potential this transaction is bringing to Boralex. This transaction will be accretive to discretionary cash flow (AFFO) per share in the first year and will be a springboard to further development in these new regional energy markets for Boralex, especially California.”

Patrick Lemaire, president and CEO of Boralex.

“We are excited to announce these agreements to acquire interests in this portfolio of solar plants, which offers a good seasonal complement to our wind and hydro assets as well as predictable cash flows. Upon closing, Boralex will become the new managing member of the sites and, over time, we will implement various strategies expected to increase the results for Boralex.”

Patrick Decostre, vice president and COO of the corporation.
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