Commodities update: Brookfield pursues Terraform shares; CIBC upgrades Canfor; Maple Leaf CEO slams Trump
Brookfield Renewable Partners LP, looking to bolster its status as one of the world’s largest clean-energy providers, is bidding to buy the shares of TerraForm Power Inc. it doesn’t already own in a deal valuing the company at US$3.9 billion.
The proposal values TerraForm Power -- a yieldco -- at US$17.31 a share, representing an 11 per cent premium to the closing share price on January 10, according to a statement Monday. Brookfield Asset Management Inc. already controls 61.5 per cent of the Class A shares outstanding.
TerraForm’s shares soared 10 per cent in early trading Monday to US$17.15 while Brookfield was mostly unchanged.
Yieldcos, which operate wind and solar farms and promise growing dividends, were darlings on Wall Street five years ago but fell out of favor as clean-energy giant SunEdison Inc. stumbled toward bankruptcy. Brookfield bought its controlling stake in TerraForm from SunEdison in 2017.
Brookfield Renewable’s portfolio consists of more than 18,000 megawatts of capacity and 5,253 generating facilities in North America, South America, Europe and Asia. TerraForm has a global portfolio of more than 4,000 megawatts.
It’s a non-binding, unsolicited all-share proposal. Each Class A common share of TerraForm would be acquired for a consideration equivalent to 0.36 of a Brookfield Renewable unit.