Cleantech Power Corp announced that it has entered into a non-binding letter of intent (LOI) with an arm’s length third party to acquire, directly and indirectly, certain operating combined heat and power and other assets (CHP Assets) located in North America.
The diversified investment platform developing affordable, renewable, and reliable power and cleantech said the acquisition will involve making two payments.
The first (COD Payment), to be made upon closing, relates to CHP Assets that are past commercial operation and will consist of a payment of about $7.5 million.
The second (Non-COD Payment) relates to CHP Assets that are currently not past their commercial operation date and will consist of a payment of approximately $5 million. The Non-COD Payment will be made in the sole discretion of the company.
“In addition to the potential transaction contributing towards the company becoming EBITDA-positive, the new project pipeline associated with the CHP Assets would bring our current total on non-contracted sales leads to over $150 million in CHP projects to develop in the coming years,” Cleantech Power CEO Frank Carnevale said in a statement.
Cleantech noted that the transaction, if consummated, have the potential to provide it with about $1.5 million in annual cash flow.
The company added that certain of the projects associated with the CHP Assets are subject to contract terms between 15 to 20 years.
As well, Cleantech stated the projects associated with the CHP Assets are synergistic with the company’s experience in operations of other CHP assets currently in its portfolio.
Furthermore, the company said the potential transaction is expected to assist Cleantech in funding current operations, including the development of its fuel cell assets in Belgium and other clean technology.
Cleantech Power is a diversified investment platform developing affordable, renewable, and reliable power assets and cleantech.
Contact Sean at sean@proactiveinvestors.com