SunEdison has agreed to sell 333 megawatts of wind-power assets to Terra Nova Renewable Partners for $209 million. Terra Nova Renewable Partners is the strategic equity partnership formed between SunEdison and institutional investors advised by J.P. Morgan Asset Management – Global Real Assets.
The two acquired projects are the 185 megawatt Bingham wind farm and 148 megawatt Oakfield wind farm, both located in Maine. Construction on Oakfield Wind was completed this fall and it is now online and operating as the largest wind project in New England. The Oakfield project's tax equity was funded and the construction loan was converted to a term loan.
KeyBanc Capital Markets served as an advisor to SunEdison. CohnReznick Capital Markets served as financial advisor and Milbank, Tweed, Hadley & McCloy LLP served as legal advisor to J.P. Morgan Asset Management.
Brian Wuebbels, SunEdison's chief financial officer, stated:
"This transaction represents good value for SunEdison's shareholders and enhances our financial strength and flexibility. Terra Nova's purchase is representative of the strong demand we've seen for ownership of SunEdison's attractive renewable energy assets."
Matt LeBlanc, J.P. Morgan Asset Management – Global Real Assets' chief investment officer of OECD Infrastructure, commented:
"These high-quality SunEdison projects with long-term contracted cash flows are the kind of infrastructure assets our investors are interested in holding. This is a significant transaction and the first with SunEdison since we announced our strategic partnership, and we look forward to completing more in the future."
The strategic partnership was announced in September 2015. Under the partnership commitment, J.P. Morgan's clients are expected to provide equity to purchase renewable energy projects developed or purchased by SunEdison. Remaining project costs are expected to be funded with traditional, non-recourse commercial bank debt and tax equity.
Proceeds from this transaction provide SunEdison with an upfront development margin. SunEdison has the right to repurchase the projects from the partnership for a period of five years, and will grant TerraForm Power, a global owner and operator of clean energy power plants, call rights to the projects should they be repurchased. Any projects not repurchased by SunEdison would continue to be owned by the partnership.