Canada Pension Plan Investment Board (CPPIB) has agreed to acquire US renewable energy company Pattern Energy Group in a deal valued at around $6.1bn, including the latter’s net debt.
The all-cash deal will see the Canadian sovereign wealth fund acquire 100% of the renewable energy developer for $26.75 per share.
Headquartered in California, Pattern Energy has a portfolio of 28 renewable energy projects located in the US, Canada and Japan. The combined capacity of the company’s wind and solar facilities is 4.4GW.
CPPIB managing director and power and renewables head Bruce Hogg said: “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.
“The Pattern Energy management team has a proven track record of identifying and executing development strategies with differentiated competitive advantages.”
Pattern Energy to be combined with Pattern Development
Concurrently, CPPIB has entered into an agreement with Riverstone, under which, the latter will combine Pattern Energy and Pattern Energy Group Holdings 2 (Pattern Development) under common ownership. The proposed combination will bring together Pattern Energy’s operating assets with the development projects and capabilities of Pattern Development.
The transaction with Riverstone will be subject to the completion of CPPIB’s acquisition of Pattern Energy.
Pattern Development is engaged in developing renewable energy and transmission assets. The company is said to have developed, financed and commissioned more than 4GW of wind and solar power projects across the world.
Pattern Energy CEO Mike Garland said: “This agreement with CPPIB and Riverstone provides certain and significant value for Pattern Energy shareholders with an all cash transaction at a very attractive stock price.
“Over the years, Pattern Energy has been able to provide shareholders with a consistent dividend and now our shareholders can realize the value embedded in the Company. We believe the proposed transaction reflects the strength of the platform we have built.”
CPPIB’s acquisition of Pattern Energy will be subject to the latter’s shareholder approval, regulatory approvals, and other customary closing conditions, and is likely to close by the second quarter of next year. The closing of the transaction will not be subject to the completion of the Pattern Development deal.
