EDMONTON, Alberta - Capital Power Corporation (TSX: CPX) ("Capital Power") and EPCOR Utilities Inc. ("EPCOR") announced today that EPCOR has entered into an agreement with a syndicate of underwriters, led by RBC Capital Markets and TD Securities Inc. as bookrunners, for a secondary offering by a subsidiary of EPCOR, on a bought deal basis, of 8,334,000 common shares of Capital Power at an offering price of $24.00 per common share. Capital Power will not receive any of the proceeds (approximately $200 million, before giving effect to the over-allotment option) from the sale of common shares by EPCOR's subsidiary.
The underwriters have also been granted an option to purchase up to an additional 1,250,000 common shares at the issue price to cover over-allotments, if any, for additional gross proceeds of approximately $30 million. The over-allotment option is exercisable, in whole or in part, by the underwriters at any time up to 30 days after the closing of the offering. Capital Power will not receive any proceeds from the exercise of the over-allotment option.
After giving effect to this offering, but before giving effect to the over-allotment option, EPCOR will indirectly own 61.6% of the common shares of Capital Power on a fully diluted basis. EPCOR intends to sell all or a portion of its remaining interest in Capital Power as its demands for capital require and market conditions permit. The proceeds from the current offering will be used by EPCOR to permanently finance previously announced investments, support ongoing capital expenditure programs, pay down short term debt and for general corporate purposes.
The common shares will be offered in all provinces of Canada by way of a prospectus supplement to a base shelf prospectus of Capital Power. The Offering will also be extended to Qualified Institutional Buyers in the United States pursuant to the exemptions from registration provided by Rule 144A of the Securities Act of 1933, as amended (the "U.S. Securities Act"), and internationally where permitted. Closing of the Offering is expected to occur on or about December 14, 2010.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities of the Corporation in any jurisdiction in which such offer, solicitation of sale would be unlawful. These securities have not been and will not be registered under the U.S. Securities Act or any U.S. state securities laws and may not be offered or sold in the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws or pursuant to an exemption therefrom.
Certain information in this news release relating to EPCOR is forward looking and related to anticipated events and strategies. When used in this context, words such as "will", "anticipate", "believe", "plan", "intend", "target" and "expect" or similar words suggest future outcomes. By their nature, such statements are subject to significant risks and uncertainties, which include, but are not limited to, regulatory and government decisions, economic conditions, and availability and cost of financing.
Readers are cautioned not to place undue reliance on forward-looking statements as actual results could differ materially from the plans, expectations, estimates or intentions expressed in the forward-looking statements. Except as required by law, EPCOR disclaims any intention and assumes no obligation to update any forward-looking statement even if new information becomes available, as a result of future events or for any other reason.
Capital Power is a growth-oriented North American independent power producer, building on more than a century of innovation and reliable performance. The Company's vision is to be recognized as one of North America's most respected, reliable and competitive power generators. Headquartered in Edmonton, Alberta, Capital Power has interests in 32 facilities in Canada and the U.S. totalling nearly 3,800 megawatts of generation capacity. Capital Power and its subsidiaries develop, acquire and optimize power generation from a wide range of energy sources.
EPCOR's wholly owned subsidiaries build, own and operate electrical transmission and distribution networks, water and wastewater treatment facilities and infrastructure. EPCOR, headquartered in Edmonton, Alberta, is an Alberta Top 50 employer.