Atlantica Yield holder Abengoa sells 25% to Algonquin Power & Utilities
02 NOV 2017
Abengoa [BME:ABG], late on 1 November made the following SIGNIFICANT EVENT stock exchange announcement.
The Company informs that on November 1st, 2017 it has entered into a sale purchase agreement with Algonquin Power & Utilities Corp., [AQN:CN] a growth-oriented renewable energy and regulated electric, natural gas and water utility company (the “Purchaser”, “Algonquin” or “APUC”), for the sale of a stake of 25% of the issued share capital of Atlantica Yield plc. (“AY”). The sale will become effective once certain conditions precedent have been fulfilled, among others, the approval of the transaction by certain regulatory authorities as well as the Company’s creditors (the “25% Sale”).
The agreed purchase price of USD 24.25 per share is subject to certain deductions included in the agreement as well as transaction costs. In addition, the parties have further agreed an earn-out mechanism by which Abengoa will benefit from 30% of the first 2.00 USD of Atlantica Yield’s share price revaluation, implying a maximum additional amount of USD 0.60 per share. The earn-out structure will be triggered on the first anniversary of the closing of the transaction.
The capital gain will be effective upon closing the transaction, on the date hereof it is estimated that it will be of approximately EUR 96m.
As part of the transaction, the Company has also granted the Purchaser an option to acquire the remaining 16.5% of the Company’s stake in AY under the same conditions and at the same price, subject to the US Department of Energy approval, during a period that expires 60 days following completion of the 25% Sale, as well as a right of first refusal to be exercised during the first quarter of 2018.
Additionally, on November 1st, 2017, the Company and Algonquin have entered into a memorandum of understanding (“MOU”) to, among other things, jointly incorporate a global utility infrastructure company with the purpose of identifying, developing, constructing, owning and operating a portfolio of global utility infrastructure projects ("AAGES").
The incorporation of AAGES provides an opportunity to leverage on the strengths of each the partners, and help pursuing their mutual and complementary interests. For Abengoa it is an opportunity to strengthen its core EPC and O&M businesses while for Algonquin AAGES will be their international project development platform. In addition, AAGES will provide AY with an ongoing pipeline of compelling asset investment opportunities.
The capital gain will be effective upon closing the transaction, on the date hereof it is estimated that it will be of approximately EUR 96m.
As part of the transaction, the Company has also granted the Purchaser an option to acquire the remaining 16.5% of the Company’s stake in AY under the same conditions and at the same price, subject to the US Department of Energy approval, during a period that expires 60 days following completion of the 25% Sale, as well as a right of first refusal to be exercised during the first quarter of 2018.
Additionally, on November 1st, 2017, the Company and Algonquin have entered into a memorandum of understanding (“MOU”) to, among other things, jointly incorporate a global utility infrastructure company with the purpose of identifying, developing, constructing, owning and operating a portfolio of global utility infrastructure projects ("AAGES").
The incorporation of AAGES provides an opportunity to leverage on the strengths of each the partners, and help pursuing their mutual and complementary interests. For Abengoa it is an opportunity to strengthen its core EPC and O&M businesses while for Algonquin AAGES will be their international project development platform. In addition, AAGES will provide AY with an ongoing pipeline of compelling asset investment opportunities.
Investor call
Abengoa’s Executive Chairman, Gonzalo Urquijo, will hold a conference call on Thursday, November 2nd, 2017, which will be simultaneously webcast, at 1 p.m. C.E.T.
The transaction presentation slides to be used on the conference call as well as numbers to access the conference call will be published on Abengoa’s website: www.abengoa.com.
Abengoa’s Executive Chairman, Gonzalo Urquijo, will hold a conference call on Thursday, November 2nd, 2017, which will be simultaneously webcast, at 1 p.m. C.E.T.
The transaction presentation slides to be used on the conference call as well as numbers to access the conference call will be published on Abengoa’s website: www.abengoa.com.