ALLETE Advances Solar Strategy by Acquiring New Energy Equity, a Leading Solar Development Company
02 März 2022 - 10:05PM
Business Wire
Acquisition supports ALLETE’s
sustainability-in-action strategy
ALLETE, Inc. (NYSE:ALE), today advanced its planned expansion in
the solar energy sector, announcing it has signed a definitive
agreement to acquire 100 percent of the membership interests of New
Energy Equity LLC, one of the nation’s top distributed solar
developers, for approximately $165.5 million, subject to a working
capital adjustment.
New Energy Equity, with headquarters in Annapolis, Maryland, is
one of the country’s leading distributed solar development
companies, having successfully completed more than 250 projects
across the nation totaling more than 310 megawatts. New Energy
Equity also offers comprehensive solar operations, maintenance, and
asset management services to its customers through its wholly owned
subsidiary, Energy Support Services.
“New Energy Equity’s strong track record of success, talented
and experienced team, robust project pipeline and significant
growth potential will support ALLETE’s long-term average annual
growth objective of 5 percent to 7 percent,” said ALLETE Chair,
President and CEO Bethany Owen. “The company is a natural fit with
our sustainability-in-action strategy and shares our commitment to
transforming the nation’s energy landscape. Solar is an exciting
and expanding area of our industry’s clean-energy transformation,
and New Energy Equity brings to ALLETE the expertise and experience
to offer comprehensive solar solutions to customers, adding to our
existing wind energy capabilities.”
Solar Power World ranked New Energy Equity, which specializes in
development of distributed-generation solar facilities from 1 to 10
megawatts, as the nation’s 7th Top Solar Developer and 8th Top
Commercial Solar Contractor in 2021. New Energy Equity’s national
reach includes completed projects and projects under development in
26 U.S. states.
“Our team is excited to join the ALLETE family of companies,
bringing broadened expertise and access to capital to New Energy
Equity,” said New Energy Equity President and CEO Matthew Hankey.
“ALLETE is an incredible organization that shares in our company’s
core values, including a focus on sustainability, long-term
partnerships and a workforce culture that promotes and values
employee contributions. With our combined experience, we can expand
the reach of distributed-generation solar and storage projects to
provide more sustainable energy solutions for our communities,
industry partners and customers. We look forward to joining forces
with ALLETE to help further the clean-energy transformation
together.”
ALLETE expects the purchase to close in mid-April upon
satisfaction of customary closing conditions, including compliance
with Hart-Scott-Rodino antitrust clearing requirements. New Energy
Equity’s entire team, including management, will remain in place,
as will its Maryland headquarters.
In 2021 New Energy Equity closed 35 solar projects representing
more than 80 megawatts in the aggregate, and generated adjusted
EBITDA of approximately $20 million. Under ALLETE’s ownership,
results for the year ended 2022 will be impacted by transaction
costs and purchase price accounting. ALLETE anticipates the
acquisition to be accretive in 2023 for the first full year of
ownership. New Energy Equity is expected to provide organic
long-term earnings growth with strong cash flow contributions.
ALLETE's previously stated 2022 earnings guidance excludes
potential acquisitions and related costs; 2022 guidance will be
updated during the year.
“New Energy Equity’s business model—developing, financing and
selling a large number of small projects annually—complements
ALLETE’s other businesses that typically focus on larger,
utility-scale projects. With its flexible capital needs, attractive
cash flow and earnings accretion characteristics, we believe New
Energy Equity is a strong value proposition for ALLETE and its
investors,” Owen said. “We are very excited to welcome the New
Energy Equity team to ALLETE as we continue, together, advancing
the clean energy future—for our customers, communities, employees
and investors.”
J.P. Morgan acted as exclusive financial advisor to ALLETE on
this transaction.
Live Webcast on March 3, 2022 ALLETE’s conference call
will be at 10:00 a.m. (EST), March 3, 2022, at which time
management will discuss the acquisition. To participate in the
call, analysts are asked to dial 877-303-5852, pass code 5939153,
ten minutes prior to the start time and refer to the “ALLETE’s
Conference Call Announcing Acquisition.” All interested parties may
listen to the live audio-only webcast accompanied by supporting
slides, which will be available on ALLETE’s Investor Relations
website http://investor.allete.com/events-presentations. A replay
of the call will be available through March 10, 2022, by calling
(855) 859-2056, pass code 5939153.
ALLETE, Inc. is an energy company headquartered in Duluth,
Minnesota. In addition to its electric utilities, Minnesota Power
and Superior Water, Light and Power of Wisconsin, ALLETE owns
ALLETE Clean Energy, based in Duluth; and BNI Energy in Bismarck,
N.D.; and has an eight percent equity interest in the American
Transmission Co. More information about ALLETE is available at
www.allete.com. ALE-CORP
The statements contained in this release and statements that
ALLETE may make orally in connection with this release that are not
historical facts, are forward-looking statements. Actual results
may differ materially from those projected in the forward-looking
statements. These forward-looking statements involve risks and
uncertainties and investors are directed to the risks discussed in
documents filed by ALLETE with the Securities and Exchange
Commission.
The adjusted EBITDA measure for New Energy Equity represents net
income (loss) before interest, taxes, depreciation and
amortization, adjusted for the impact of certain non-cash and other
items, such as non-recurring expenses.
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version on businesswire.com: https://www.businesswire.com/news/home/20220302006039/en/
Investor Contact: Vince Meyer 218-723-3952 vmeyer@allete.com
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