EDMONTON, Alberta – November 7, 2018 – Capital Power Corporation (Capital Power or the Company) (TSX: CPX) announced today that it has entered into an agreement for the sale of its minority owned interest of 90 megawatts (MW) in K2 Wind to a consortium of investors led by Axium Infrastructure (Axium Consortium) for $216 million. The expected closing date of the transaction is December 31, 2018 subject to regulatory approvals and other customary closing conditions.
K2 Wind, a 270 MW wind generation facility located in Ontario, is a joint venture between Capital Power, Pattern Energy Group Inc. (Pattern Energy), and an Axium-led consortium. Pattern Energy has also agreed to sell its interest in the facility to the Axium Consortium under the same agreement.
K2 began commercial operations in May 2015 and supplies renewable energy to the province of Ontario under a 20-year power purchase arrangement with the Ontario IESO. Capital Power’s initial equity investment was $44 million.
“We are very pleased with the robust crystallization of value on a wind facility we developed,” said Brian Vaasjo, President & CEO of Capital Power. “The proceeds from the sale will be reinvested in contracted renewables and natural gas assets across North America and will represent a significant equity contribution to our future growth initiatives. Our current announced growth projects do not require funding from the equity capital markets and this contribution will further enable additional substantial growth investments without having to access the equity markets.”
Certain information in this news release is forward-looking within the meaning of Canadian securities law as it relates to anticipated financial and operating performance, events or strategies. The forward-looking information or statements are provided to inform the Company’s shareholders and potential investors about management’s assessment of Capital Power’s future plans and operations. This information may not be appropriate for other purposes. The forward-looking information in this press release is generally identified by words such as will, anticipate, believe, plan, intend, target, and expect or similar words that suggest future outcomes.
Material forward-looking information in this press release around the divestiture of K2 Wind includes expectations regarding: (i) transaction close timing, and (ii) use of the proceeds from the sale of K2 including reinvestment in contracted renewables and natural gas opportunities.
These statements are based on certain assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions, expected future developments, and other factors it believes are appropriate. The material factors and assumptions used to develop these forward-looking statements relate to: (i) timing of satisfaction of all closing conditions relating to the sale of K2, including receipt of all required regulatory approvals, (ii) availability of potential investment opportunities, and (iii) future funding requirements.
Whether actual results, performance or achievements will conform to the Company’s expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results and experience to differ materially from the Company’s expectations. Such material risks and uncertainties are: (i) changes in the investment environment for contracted renewables and natural gas assets in North America, (ii) regulatory and political environments including changes to environmental, financial reporting, market structure and tax legislation, and (iii) changes in general economic and competitive conditions. See Risks and Risk Management in the Company’s 2017 Management’s Discussion and Analysis for further discussion of these and other risks.
Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the specified release date. The Company does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.
About Capital Power
Capital Power (TSX: CPX) is a growth-oriented North American power producer headquartered in Edmonton, Alberta. The company develops, acquires, owns, and operates power generation facilities using a variety of energy sources. Capital Power owns approximately 4,500 megawatts (MW) of power generation capacity at 24 facilities across North America. Approximately 1,000 MW of owned generation capacity is in advanced development in Alberta, North Dakota, and Illinois.