Solar, Wind Power

Canada Pension Plan Investment Board to acquire Pattern Energy for $6.1B

Wind turbines near St. Joseph Manitoba Canada, visible from Highway 75 mid-way between Winnipeg and the US border. Photo taken 2011 May 14 by Wtshymanski

Pattern Energy Group and Canada Pension Plan Investment Board (CPPIB) today announced they have entered into a definitive agreement, pursuant to which CPPIB will acquire Pattern Energy in an all-cash transaction for $26.75 per share, implying an enterprise value of approximately $6.1 billion, including net debt.

CPPIB entered the agreement concurrently with Riverstone Holdings LLC. Once complete CPPIB and Riverstone will combine Pattern Energy and Pattern Energy Group Holdings 2 LP (Pattern Development) under common ownership, bringing together the operating assets of Pattern Energy with the development projects and capabilities of Pattern Development.

Pattern Energy has a portfolio of 28 renewable energy projects with an operating capacity of 4.4 GW in the United States, Canada and Japan. With a long history in wind energy, Pattern Development has developed, financed and placed into operation more than 4,000 MW of wind and solar power projects.

Under the terms of the agreement, Pattern Energy shareholders will receive $26.75 in cash consideration for each share of Pattern Energy, representing a premium of approximately 14.8% to Pattern Energy’s closing share price on August 9, 2019, the last trading day prior to market rumors regarding a potential acquisition of the company. The consideration also represents a 15.1% premium to the 30-day volume weighted average price prior to that date.

“Pattern Energy is one of the most experienced renewables developers in North America and Japan with a high-quality, diversified portfolio of contracted operating assets, aligning well with CPPIB’s renewable energy investment strategy and the increasing global demand for low-carbon energy,” said Bruce Hogg, Managing Director, Head of Power and Renewables, CPPIB. “The Pattern Energy management team has a proven track record of identifying and executing development strategies with differentiated competitive advantages. We look forward to working with Pattern Energy and Riverstone to grow the company.”

The transaction is expected to close by the second quarter of 2020, subject to Pattern Energy shareholder approval, receipt of the required regulatory approvals, and other customary closing conditions. The Pattern Energy transaction is not contingent upon the completion of the Pattern Development transaction.

Upon the completion of the transaction, Pattern Energy will become a privately held company and shares of Pattern Energy’s common stock will no longer be listed on any public market. Pattern Energy will continue paying its quarterly dividend through the transaction close.

Lead image: Wind turbines near St. Joseph Manitoba Canada, visible from Highway 75 mid-way between Winnipeg and the US border. The wind farm was developed by Pattern energy Group. Photo taken 2011 May 14 by Wtshymanski.