Brookfield Renewable Partners L.P. (“Brookfield Renewable” or
“BEP”) (TSX: BEP.UN; NYSE: BEP) and TerraForm Power, Inc.
(“TerraForm Power” or “TERP”) (Nasdaq: TERP) today announced that
they have entered into a definitive merger agreement for Brookfield
Renewable to acquire all of the outstanding shares of Class A
common stock of TerraForm Power, other than the approximately 62%
currently owned by Brookfield Renewable and its affiliates.
Each share of Class A common stock of TerraForm
Power will be acquired for consideration equivalent to 0.381 of a
Brookfield Renewable unit. For each share of TerraForm Power’s
Class A common stock held, TERP shareholders will be entitled to
receive, at their election, either Class A shares of Brookfield
Renewable Corporation (“BEPC shares”) or limited partnership units
of Brookfield Renewable (“BEP units”).
The Special Committee of the Board of Directors
at TerraForm Power (the “Special Committee”), comprised solely of
non-executive, independent directors of TerraForm Power, has
unanimously recommended that TERP shareholders approve the
transaction. The Special Committee believes the transaction is fair
to and in the best interests of TERP and its unaffiliated
shareholders.
“This is a compelling transaction that creates
significant value for investors in both companies through a
simplified corporate structure and continued sponsorship from
Brookfield Asset Management,” said Sachin Shah, CEO of Brookfield
Renewable. “We are pleased to have reached an agreement for a
combined business with a longstanding track record of creating
value for shareholders through all economic cycles, where investors
will benefit from a globally diversified mandate, supported by
significant access to capital and one of the strongest investment
grade balance sheets in the sector.”
He continued, “The form of consideration through
BEP units or the new BEPC shares will allow TERP shareholders to
choose how to most efficiently participate in the transaction,
either through a partnership or corporate structure.”
Mac McFarland, Chair of the Special Committee,
said, “We are pleased to have reached this agreement with
Brookfield Renewable and believe it is in the best interests of
TERP and its shareholders. Since receiving Brookfield Renewable’s
initial proposal in January, the Special Committee has conducted
extensive due diligence. With the assistance of our independent
advisors, we have concluded that Brookfield Renewable’s improved
proposal, which includes an increase in the exchange ratio,
provides an immediate realization of value and upside potential.
With the transaction, TERP shareholders will benefit from
access to a broader growth mandate that includes the acquisition of
global, multi-technology renewable power assets and development
opportunities, as well as increased access to capital and
liquidity, underpinned by an investment grade balance sheet.”
The combined company will be one of the largest
publicly-traded, globally-diversified, multi-technology, pure-play
renewable power platforms, with total assets of approximately $50
billion and expected annual funds from operations of approximately
$1 billion.
____________
- Based on unaffected trading prices
of $15.60/share and $48.07/unit for TERP and BEP, respectively at
market close on January 10, 2020.
Transaction Details
As consideration for the transaction, TERP
shareholders can elect to receive, for each share of TerraForm
Power Class A common stock held, either BEPC shares or BEP units.
Consideration for each share of Class A common stock of TERP will
be equivalent to 0.381 of a BEP unit. TERP shareholders who do not
make any election will receive BEPC shares. There is no limit on
the number of TERP shares that may be exchanged for BEPC shares or
BEP units.
As previously announced, Brookfield Renewable
also intends to make a special distribution of BEPC shares to its
unitholders. BEPC is a Canadian corporation and will be listed on
the TSX and NYSE. The BEPC shares are structured with the intention
of being economically equivalent to a BEP unit, including identical
distributions, as and when declared, and will be fully exchangeable
at any time, at the shareholder's option, for a BEP unit on a
one-for-one basis. As such, offering TERP shareholders the right to
elect to receive BEP units or BEPC shares provides them the option
of investing in Brookfield Renewable through a partnership or
corporate structure. The exchange ratio will proportionally reflect
the contemplated special distribution of BEPC shares to Brookfield
Renewable unitholders, which we expect to close concurrently with
the closing of the transaction.
The transaction is subject to, among other
things, the non-waivable approval of TERP shareholders representing
a majority of the outstanding shares of TERP Class A common stock
not owned by Brookfield Renewable and its affiliates. The
transaction is also subject to other customary closing conditions
and is expected to close in the third quarter of 2020.
BMO Capital Markets and Scotiabank are serving
as financial advisors and Cravath, Swaine & Moore LLP and Torys
LLP are serving as legal counsel to Brookfield Renewable.
Morgan Stanley & Co. LLC and Greentech
Capital Advisors are serving as financial advisors and Kirkland
& Ellis LLP and Richard, Layton and Finger LLP are serving as
legal counsel to the Special Committee.
Brookfield Renewable
Partners
Brookfield Renewable operates one of the world’s
largest publicly traded, pure-play renewable power platforms. Our
portfolio consists of hydroelectric, wind, solar and storage
facilities in North America, South America, Europe and Asia, and
totals approximately 19,000 megawatts of installed capacity and an
approximately 13,000 megawatt development pipeline. Brookfield
Renewable is listed on the New York and Toronto stock exchanges.
Further information is available at https://bep.brookfield.com.
Important information may be disseminated exclusively via the
website; investors should consult the site to access this
information.
Brookfield Renewable is the flagship listed
renewable power company of Brookfield Asset Management, a leading
global alternative asset manager with over $540 billion of assets
under management.
TerraForm Power
TerraForm Power owns and operates a
best-in-class renewable power portfolio of solar and wind assets
located primarily in the U.S. and E.U., totaling more than 4,200 MW
of installed capacity. TerraForm Power’s goal is to acquire
operating solar and wind assets in North America and Western
Europe. TerraForm Power is listed on the Nasdaq Stock Market
(Nasdaq: TERP).
Brookfield Contact Information: |
|
Media:Claire
Holland Vice President –
Communications(416)
369-8236 claire.holland@brookfield.com
|
Investors:Robin
KooymanSenior Vice President – Investor
Relations(416)
649-8172robin.kooyman@brookfield.com
|
|
|
TerraForm Power Contact Information:Sherif
El-AzzaziHead of Investor
Relations(646) 992-2437
investors@terraform.com |
|
Cautionary Statement Regarding
Forward-looking Statements This communication
contains forward-looking statements and information within the
meaning of Canadian provincial securities laws and “forward-looking
statements” within the meaning of Section 27A of the U.S.
Securities Act of 1933, as amended, Section 21E of the U.S.
Securities Exchange Act of 1934, as amended, “safe harbor”
provisions of the United States Private Securities Litigation
Reform Act of 1995 and in any applicable Canadian securities
regulations. The words “will”, “intend”, “should”, “could”,
“target”, “growth”, “expect”, “believe”, “plan”, derivatives
thereof and other expressions which are predictions of or indicate
future events, trends or prospects and which do not relate to
historical matters identify the above mentioned and other
forward-looking statements. Forward-looking statements in this
communication include statements regarding the transaction, the
prospects and benefits of the combined company and the special
distribution of BEPC shares and any other statements regarding the
parties’ future expectations, beliefs, plans, objectives, financial
conditions, assumptions or future events or performance. Although
Brookfield Renewable and TerraForm Power believe that these
forward-looking statements and information are based upon
reasonable assumptions and expectations, you should not place undue
reliance on them, or any other forward-looking statements or
information in this communication. The future performance and
prospects of Brookfield Renewable and TerraForm Power is subject to
a number of known and unknown risks and uncertainties. Factors that
could cause actual results of Brookfield Renewable and TerraForm
Power to differ materially from those contemplated or implied by
the statements in this communication include uncertainties as to
whether TerraForm Power’s Special Committee will continue to
recommend any transaction with BEP to the TERP stockholders;
uncertainties as to whether TerraForm Power stockholders not
affiliated with Brookfield Renewable will approve any transaction;
uncertainties as to whether the other conditions to the transaction
will be satisfied or satisfied on the anticipated schedule; the
timing of the transaction and whether the transaction will be
completed, including as a result of potential litigation in
connection with the transaction; failure to realize contemplated
benefits from the transaction, including the possibility that the
expected synergies and value creation from the transaction will not
be realized; the inability to retain key personnel; and incurrence
of significant costs in connection with the transaction. For
further information on these known and unknown risks, please see
“Risk Factors” included in TerraForm Power’s most recent Annual
Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q
and Current Reports on Form 8-K filed with the Securities and
Exchange Commission (“SEC”) and in Brookfield Renewable’s Form 20-F
and other risks and factors that are described therein and that are
described in Brookfield Renewable’s and BEPC’s joint preliminary
Form F-1 and prospectus filed with the SEC and the securities
regulators in Canada.
The foregoing list of important factors that may
affect future results is not exhaustive. The forward-looking
statements represent our views as of the date of this communication
and should not be relied upon as representing our views as of any
subsequent date. While we anticipate that subsequent events and
developments may cause our views to change, we disclaim any
obligation to update the forward-looking statements, other than as
required by applicable law.
Additional Information and Where to Find
It This communication is neither a solicitation of a proxy
nor a substitute for any proxy statement or other filings that may
be made with the SEC. Any solicitation will only be made through
materials filed with the SEC. Nonetheless, this communication may
be deemed to be solicitation material in respect of the transaction
by Brookfield Renewable and TerraForm Power. Brookfield Renewable
and BEPC expect to file relevant materials with the SEC, including
a registration statement on Form F-4 that will include a proxy
statement of TerraForm Power that also constitutes a prospectus of
Brookfield Renewable and BEPC (the “F-4”). This communication is
not a substitute for the registration statement, definitive proxy
statement/prospectus or any other documents that Brookfield
Renewable, BEPC or TerraForm Power may file with the SEC or send to
shareholders in connection with the transaction. SHAREHOLDERS OF
TERRAFORM POWER ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH
THE SEC (IF AND WHEN THEY BECOME AVAILABLE), INCLUDING THE PROXY
STATEMENT/PROSPECTUS, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE TRANSACTION.
Investors and security holders will be able to
obtain copies of the F-4, including the proxy statement/prospectus,
and other documents filed with the SEC (if and when available) free
of charge at the SEC’s website, http://www.sec.gov. Copies of
documents filed with the SEC by Terraform Power will be made
available free of charge on Terraform Power’s website at
http://www.terraformpower.com/. Copies of documents filed with the
SEC by Brookfield Renewable and BEPC will be made available free of
charge on Brookfield Renewable’s website at
http://bep.brookfield.com/. Such documents are not currently
available.
Participants in Solicitation
TerraForm Power and its directors and executive officers, BEPC and
its directors and executive officers, and Brookfield Renewable and
its directors and executive officers may be deemed to be
participants in the solicitation of proxies from the holders of
TerraForm Power common stock in respect of the transaction.
Information about the directors and executive officers of TerraForm
Power is set forth on its website at
http://www.terraformpower.com/. Information about the directors and
executive officers of Brookfield Renewable is set forth on its
website at http://bep.brookfield.com/. Information about the
directors and executive officers of BEPC will be set forth on its
preliminary Form F-1. Investors may obtain additional information
regarding the interests of such participants by reading the proxy
statement/prospectus regarding the transaction when it becomes
available. You may obtain free copies of these documents as
described in the preceding paragraph.
Non-solicitationNo securities
regulatory authority has either approved or disapproved of the
contents of this communication. This communication shall not
constitute an offer to sell or the solicitation of an offer to sell
or the solicitation of an offer to buy any securities, nor shall
there be any sale of securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Brookfield Renewable Par... (TSX:BEP.UN)
Historical Stock Chart
From Jun 2024 to Jul 2024
Brookfield Renewable Par... (TSX:BEP.UN)
Historical Stock Chart
From Jul 2023 to Jul 2024