Brookfield Renewable, together with its partners, has signed an agreement with Duke Energy to acquire the latter’s commercial renewables business for around $2.8bn.
Duke’s renewables business, dubbed Duke Energy Renewables, is a fully integrated developer and operator of renewable power assets in the US.
The renewables unit has 5,900MW of wind, utility-scale solar and storage assets, currently operating and under construction, along with a 6,100MW development pipeline.
Under the terms of the agreement, Duke Energy will receive around $1.1bn, subject to certain customary adjustments.
The transaction is expected to be completed by the end of this year, subject to certain customary closing conditions, including regulatory approval and the expiration of the waiting period under the Hart-Scott-Rodino Act.
Duke Energy chair, president and CEO Lynn Good said: “As one of the country’s largest renewable energy operators, Brookfield has the resources to support the continued growth and success of the Commercial Renewables’ portfolio.
“This sale is an important step in our transition into a purely regulated company with significant grid and clean energy investment plans that will deliver benefits to our customers and stakeholders.”
The transaction includes more than 3,400MWac of utility-scale solar, wind and battery storage across the US, in addition to operations, and new projects under construction.
Duke Energy Renewables’ primary operations will remain in Charlotte, North Carolina.
The company’s employees will be transferred to Brookfield to maintain business continuity for its operations and customers.
Duke Energy intends to use the proceeds from the transaction to strengthen its balance sheet and avoid additional holding company debt issuances.
It allows the company to focus on its regulated businesses, enhance grid reliability and help incorporate more than 30,000MW of regulated renewable energy by 2035.
Morgan Stanley & Co. and Wells Fargo Securities served as financial advisors, and Skadden, Arps, Slate, Meagher & Flom as legal counsel to Duke Energy, on the transaction.
Brookfield Renewable CEO Connor Teskey said: “With this acquisition, we are adding a scale operating renewable platform with a full suite of in-house capabilities and a proven management team experienced in operations and development.
“We are also adding to our pipeline of renewable development projects, solidifying our position as one of the largest renewable energy businesses in the US with almost 90,000 megawatts of operating and development assets.”
