Atlantic Power Announces Closing of Ridgeline Acquisition and
Canadian Hills Achieving Commercial Operations
BOSTON, Jan. 2, 2013 /CNW/ - Atlantic Power Corporation
(NYSE: AT) (TSX: ATP) ("Atlantic Power" or the "Company") announced
that on December 31, 2012, it closed
its previously announced acquisition of Ridgeline Energy Holdings,
Inc. ("Ridgeline"). Upon closing, the maturity date of the
Company's 6.00% series D extendible convertible unsecured
subordinated debentures (the "Debentures") (TSX: ATP.DB.D) was
automatically extended to December 31,
2019. The Company also announced that the approximately 300
MW Canadian Hills Wind project (the "Project" or "Canadian Hills")
achieved its commercial operation date ("COD"), and that the
Company closed tax equity funding for the Project and fully repaid
the Project's $272 million
construction loan. All figures are in US$ unless stated
otherwise.
"We are pleased to add 450 net MW of generating capacity to our
portfolio with the addition of Canadian Hills and Ridgeline, an
increase of 20%," said Barry Welch,
President and CEO of Atlantic Power. "The acquisition of Ridgeline
adds over 150 net MW of fully-operational wind generation to our
portfolio, and also positions us well for additional growth in the
renewable energy space, where we have had success managing
development and construction risk through to commercial operation.
We successfully accessed the capital markets in 2012, raising
$300 million of growth capital to
fund acquisition opportunities and closing $225 million of tax equity funding to refinance
the short-term construction debt at our Canadian Hills wind
project. We expect the addition of the Canadian Hills and Ridgeline
projects in December 2012, and the
Piedmont project in the first
quarter of 2013, will increase the average remaining power purchase
agreement ('PPA') life of our portfolio by 38% from 7.2 years to
approximately 9.9 years, as all five projects have PPAs of 20 years
or longer."
Closing of Ridgeline Acquisition
"We are excited to add the significant renewable energy
experience of the Ridgeline team to Atlantic Power," said Mr.
Welch. "They successfully managed the development and construction
of the 120 MW Meadow Creek wind project, which met all conditions
for COD on December 22, 2012, and was
delivered within budget and on schedule to qualify for the federal
stimulus grant program. We have initiated the integration of the
Ridgeline team into the Company, and are focusing their efforts on
near-term wind and solar development projects in their pipeline as
well as on assisting with our renewable acquisitions
opportunities."
The Ridgeline acquisition increases the Company's ownership
interest in the Rockland wind
project to a 50% managing member interest from 30%, and adds a
12.5% interest in the 125 MW Goshen North project in addition to a
100% equity interest in Meadow
Creek. The total cost of the Ridgeline acquisition was
$88 million, and includes the
purchase of all of the outstanding shares of capital stock of
Ridgeline and the 100% equity interest in Meadow Creek. The purchase price for the
acquisition (together with working capital and acquisition
expenses) was financed through a firm underwritten public offering,
on a bought deal basis, of Cdn$100
million aggregated principal amount of the Debentures. Upon
the closing of the acquisition, the maturity date of the Debentures
was automatically extended from March 31,
2013 to December 31, 2019 in
accordance with the terms of the Debentures. In addition, the
Company will consolidate approximately $205
million and $43 million of
existing non-recourse project-level debt at Meadow Creek and Rockland, respectively, with approximately
$55 million of current Meadow Creek debt to be repaid with a U.S.
stimulus grant in the first quarter of 2013.
Canadian Hills Wind Achieves Commercial Operation
The Company also announced today that Canadian Hills achieved
COD on December 22, 2012, which
qualifies the Project to receive federal production tax credits.
The Project received tax equity investments in aggregate of
$225 million from a consortium of
four institutional tax equity investors along with an approximately
$47 million tax equity investment by
the Company, which it expects to syndicate with additional tax
equity investors in the first quarter of 2013. The Project's
outstanding construction loan was repaid by these tax equity
investors, delevering the Project and Atlantic Power's short-term
debt by $272 million. The Company
owns 99% of the Project having made a $200
million capital contribution in July
2012. Cash distributions to the Company from the Project are
expected to be in the range of $16 to $19
million for each full year of operation through 2020, and
are expected to increase thereafter.
"We are delighted to bring Canadian Hills to COD on time and
within budget, which represents our largest construction project to
date at approximately 300 MW and a cost of $470 million," said Mr. Welch. "Atlantic Power's
team played a significant role in bringing this large, complex
construction project to completion, further demonstrating our
ability to manage late-stage development projects through financing
and construction to completion. In addition, Atlantic Power will
oversee the ongoing operation of the Project and will act as its
asset manager. We expect that this experience, coupled with the
recently-acquired, seasoned Ridgeline team, will continue to
provide Atlantic Power with opportunities to successfully grow its
renewable energy portfolio in the near-term."
About Atlantic Power
Atlantic Power is a leading publicly traded, power generation
and infrastructure company with a well-diversified portfolio of
assets in the United States and
Canada. The Company's corporate
strategy is to increase the value of the Company through accretive
acquisitions in North American markets while generating stable,
contracted cash flows from its existing assets. The Company's power
generation projects sell electricity to utilities and other large
commercial customers under long-term PPAs, which seek to minimize
exposure to changes in commodity prices. The net generating
capacity of the Company's projects is approximately 2,560 MW,
consisting of interests in 33 operational power generation projects
across 12 states and 2 provinces and also an 84-mile, 500 kilovolt
electric transmission line located in California. In addition, the Company has a 53
MW biomass project under construction in Georgia, which is expected to achieve COD in
the first quarter of 2013. Atlantic Power owns a majority interest
in Rollcast Energy, a biomass power plant developer in Charlotte, NC. The Company also owns
Ridgeline, a renewable development company out of Seattle, WA with approximately 1,000 MW of
wind and solar projects under development. Atlantic Power is
incorporated in British Columbia,
is headquartered in Boston and has
offices in Chicago, Toronto, Vancouver, Seattle and San
Diego.
Atlantic Power has a market capitalization of approximately
$1.3 billion and trades on the New
York Stock Exchange under the symbol AT and on the Toronto Stock
Exchange under the symbol ATP. For more information, please visit
the Company's website at www.atlanticpower.com or contact:
Atlantic Power Corporation
Amanda Wagemaker, Investor
Relations
(617) 977-2700
info@atlanticpower.com
Copies of financial data and other publicly filed documents get
filed on SEDAR at www.sedar.com or on EDGAR at
www.sec.gov/edgar.shtml under "Atlantic Power Corporation" or on
the Company's website.
Cautionary Note Regarding Forward-looking Statements
To the extent any statements made in this news release contain
information that is not historical, these statements are
forward-looking statements within the meaning of Section 27A of the
U.S. Securities Act of 1933, as amended, and Section 21E of the
U.S. Securities Exchange Act of 1934, as amended, and
forward-looking information as defined under Canadian securities
law (collectively, "forward-looking statements").
Certain statements in this news release may constitute
"forward-looking statements", which reflect the expectations of
management regarding the acquisition of Ridgeline and the future
growth, results of operations, performance and business prospects
and opportunities of the Company and its projects and other
matters. These statements, which are based on certain assumptions
and describe the Company's future plans, strategies and
expectations, can generally be identified by the use of the words
"may," "will," "project," "continue," "believe," "intend,"
"anticipate," "expect" or similar expressions that are predictions
of or indicate future events or trends and which do not relate
solely to present or historical matters. Examples of such
statements in this press release include, but are not limited, to
statements with respect to the following:
- the expectation that the addition of Canadian Hills,
Piedmont and Ridgeline, will
increase the Company's average remaining PPA life of its portfolio
by 38% from 7.2 years to approximately 9.9 years;
- the expectation that the Company will syndicate its
approximately $47 million tax equity
investment at Canadian Hills with additional tax equity investors
in the first quarter of 2013;
- the expectation that the Company will receive cash
distributions from Canadian Hills in the range of $16 to $19 million for each full year of
operation through 2020, and that distributions are expected to
increase thereafter; and
- the expectation that the Company's 53 MW biomass project under
construction in Georgia will
achieve COD in the first quarter of 2013.
Forward-looking statements involve significant risks and
uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not, or the times at or by which, such
performance or results will be achieved. A number of factors could
cause actual results to differ materially from the results
discussed in the forward-looking statements, including, but not
limited to, the factors discussed under "Risk Factors" in the
Company's periodic reports as filed with the U.S. Securities and
Exchange Commission and applicable securities regulatory
authorities in Canada from time to
time. Although the forward-looking statements contained in this
news release are based upon what are believed to be reasonable
assumptions, investors cannot be assured that actual results will
be consistent with these forward-looking statements, and the
differences may be material. These forward-looking statements are
made as of the date of this news release and, except as expressly
required by applicable law, the Company assumes no obligation to
update or revise them to reflect new events or circumstances. The
financial outlook information contained in this news release is
presented to provide readers with guidance on the cash
distributions expected to be received by the Company and to give
readers a better understanding of the Company's ability to pay its
current level of distributions into the future. Readers are
cautioned that such information may not be appropriate for other
purposes.
SOURCE Atlantic Power Corporation