The AES Corp. and Alberta Investment Management Corporation (AIMCo), on behalf of certain of its clients, have agreed to acquire FTP Power LLC (sPower), a large independent owner, operator and developer of utility-scale solar assets in the United States, from Fir Tree Partners and its minority owners, for $853 million in cash, plus the assumption of $724 million in non-recourse debt. In connection with the transaction, AES and AIMCo will each directly and independently purchase and own slightly below 50% equity interests in sPower.
“We are very pleased to acquire sPower,” said Andrés Gluski, AES President and Chief Executive Officer. “sPower not only brings 1.3 GW of installed capacity with an average remaining contract life of more than 20 years, but a first class management and development team with a pipeline of more than 10 GW of projects,”
sPower, a Fir Tree portfolio company that the firm capitalized in 2014, owns and operates utility and commercial distributed electrical generation systems across the United States. The sPower portfolio includes 1,274 MW of solar and wind projects in operation or under construction and a development pipeline of more than 10,000 MW located in the United States. The operating assets and projects under construction are under long-term PPAs with an average remaining life of 21 years. The offtakers under the PPAs have an average credit rating of A1. After closing, AES’ ownership of renewable energy projects in operation and under construction will grow from 8,278 MW to 9,552 MW, including hydro, wind, solar and energy storage.
“It is extremely rewarding to realize Fir Tree’s vision for sPower with this agreement between our company and AES and AIMCo,” said Jeffrey Tannenbaum, Chairman of the Board of sPower and founder of Fir Tree Partners. “sPower’s innovation and significant commercial success in just three years is testament to its outstanding management team and demonstrates that clean energy is a strong and profitable tool for driving economic growth and meaningful job creation for skilled workers. Clean energy is the future and the opportunity ahead for sPower is very large. We believe AES and AIMCo are the right partners to support the company’s continued evolution and ambitious goals for clean energy development, job creation, and greenhouse gas reductions.”
This transaction is expected to close by the third quarter of 2017, subject to review or approval by the Federal Energy Regulatory Commission, the Committee on Foreign Investment in the United States and the expiration or termination of any waiting period under the Hart-Scott-Rodino Act. The acquisition price is subject to customary post-signing purchase price adjustments.
AES will provide its 2017 guidance and longer-term expectations, and discuss this transaction on its fourth quarter and full year 2016 financial review call on February 27, 2017.
News item from AES