Atlantic Power has signed an agreement to divest 521MW of wind generation projects to TerraForm Power, the yieldco launched by SunEdison, for approximately $350m.
Under the terms of the agreement, TerraForm AP Acquisition will acquire the wind projects, which are indirectly owned by Atlantic Power Transmission, a wholly-owned direct subsidiary of Atlantic Power.
Atlantic Power will divest its economic interest in the 124.5MW Goshen North (12.5%), 183MW Idaho Wind (27.6%), 120MW Meadow Creek (100%), 80MW Rockland wind farm (50%) and 298MW Canadian Hills (99%) facilities, located in the states of Idaho and Oklahoma, US.
Scheduled to be completed in the second quarter of 2015, the transaction is subject to regulatory approvals and customary closing conditions.
Atlantic Power president and chief executive officer James Moore said: "Together with our board, we considered a wide range of options for asset divestitures over the last six months as well as options for refinancing the balance sheet without asset sales.
"In addition to completing the wind transaction, we are focused on executing the other elements of our business plan, including evaluating the best use of proceeds to optimize our capital structure for the benefit of shareholders, continuing to implement significant reductions in our corporate general and administrative expenses beyond the level already targeted for 2015, and making ongoing investments in our fleet at attractive cash-on-cash returns."
The assets would generate average annual adjusted earnings before interest, taxes, depreciation and amortization of $56m during the next decade.
Image: Atlantic Power to divest 521MW of wind generation projects to TerraForm Power. Photo: courtesy of dan/Freedigitalphotos.net.