SunEdison and TerraForm Power have announced the closing of the acquisition of Atlantic Power's 521 MW wind portfolio of operating wind power plants.
The acquired wind power plants are located in Idaho and Oklahoma, and are contracted under long term power purchase agreements (PPAs). The PPAs have a weighted-average remaining life of approximately 18 years. The portfolio is expected to generate average annual adjusted EBITDA of approximately US$56 million and average annual cash available for distribution (CAFD) of US$44 million over the next 10 years.
SunEdison Services will perform operation and maintenance for three of the five wind power plants in this transaction. SunEdison Services provides global 24/7 asset management, monitoring and reporting services.
Concurrent with the closing, SunEdison has formed its second warehouse facility, named TerraForm Private Warehouse, to hold the acquired operating assets from Atlantic Power for a maximum period of 7 years. TerraForm Power has an exclusive call right over the warehoused operating assets, and expects to add them to the company's portfolio over time beginning with drop downs in the second half of 2016.
TerraForm Private Warehouse is US$525 million in aggregate size, with equity provided by leading infrastructure investors Macquarie Capital, John Hancock, and SunEdison. Morgan Stanley, Citi, and Goldman Sachs led the structuring of TerraForm Private Warehouse and provided debt in the form of a 7-year term loan.
Brian Wuebbels, SunEdison chief financial officer, stated:
"We're pleased to complete the closing of Atlantic Power's operating assets utilizing TerraForm Private Warehouse, our new operating asset warehouse facility. This warehouse is integral to securing the future growth of the SunEdison-TerraForm platform, and provides repeatable and scalable funding. Based on the success of our first and second warehouses, we anticipate adding additional warehouse vehicles to address future acquisition opportunities."
Carlos Domenech, TerraForm Powerchief executive officer, commented:
Throughout the last week we have reported on several wind deals globally:
"SunEdison's creation of the TerraForm Private Warehouse gives TerraForm Power additional flexibility to drive growth while enhancing visibility of our growth trajectory. TerraForm Private Warehouse creates a storage tank of growth supported by long-term, contracted operating assets which are expected to generate $44 million of annual cash flow. TerraForm Power's ability to exclusively call these operating assets for drop down will support our intention to provide predictable CAFD and dividend growth for our shareholders for years to come."