International Power (LSE: IPR) announced that it has successfully completed the acquisition of Canadian wind farm developer, AIM PowerGen Corporation. International Power acquired AIM PowerGen from Renewable Energy Generation Limited (AIM: RWE) for a total value of £139m.
International Power plc is an independent electricity generating company with 32,949MW gross in operation and 3,330MW gross under construction. International Power has power plants in operation or under construction in Australia, USA, Canada, United Kingdom and Europe.
Under the terms of the deal International Power paid a £69m cash consideration and secured recourse debt financing for AIM’s 40MW Harrow project. According to international Power the acquisition is expected to be immediately free cash flow positive, and earnings accretive once the Harrow project construction programme completes in 2010.
AIM PowerGen Corporation is one of Canada's largest independent wind farm developers, it has three operational wind farms in Ontario, with many other projects in development in Ontario, Newfoundland and Western Canada. AIM is also developing a wind farm in the Dominican Republic.
In Ontario, 40 Mega Watts (MW) of wind farms are in operation in addition to the Harrow project, which has already commenced construction and is on plan for completion in the first half of 2010. AIM also has an advanced development pipeline of 1,200MW in Ontario and across Canada.
Canada has a strong commitment to renewable energy generation, with markets such as Ontario providing a supportive regulatory environment, including 20-year off-take contracts with feed-in tariffs.