RWE to Divest Stake in 4 Onshore Wind Farms in Texas to Algonquin
One of the world’s leading renewable energy companies RWE has signed an agreement with a subsidiary of Algonquin Power & Utilities Corp to sell a 51%
One of the world’s leading renewable energy companies RWE has signed an agreement with a subsidiary of Algonquin Power & Utilities Corp to sell a 51% stake in four RWE onshore wind facilities in Texas, accounting for a total pro-rata installed capacity of 439 megawatts. The total consideration corresponds to an enterprise value of around USD 600 million for the 51% stake, which translates to an implied enterprise value multiple of USD 1.4 million/MW. Two projects are in operation and two under construction. The disposal is part of RWE’s capital rotation program and the proceeds will be used to finance further growth in the renewable energy business.
Algonquin is a diversified Canadian utility with assets across the U.S. and Canada with a market capitalisation of approximately USD 10 billion. The transaction with Algonquin demonstrates the attractiveness of RWE’s portfolio in North America.
The four onshore wind farms for which the parties agreed to enter a partnership are Stella, Cranell as well as East and West Raymond. With a total installed capacity of 861 MW, they are located in the coastal region of south Texas. Stella Wind Farm (201 MW) was commissioned in December 2018 and Cranell Wind Farm (220 MW) in September this year. Raymond East (200 MW) and West (240 MW) wind farms are currently under construction. They are expected to be commissioned by the end of this year and in the first quarter of 2021 respectively. Following the closing of the transaction, RWE will continue to operate all four wind farms.
The transaction is expected to close in the first quarter of 2021 and is subject to the commissioning of the projects under construction.