On December 6, 2007, Innergex Power Income Fund announced that it had completed the acquisition of a 38% interest in the 109.5-MW Baie-des-Sables wind farm and a 38% interest in the 100.5-MW Anse-à-Valleau wind farm.
The Baie-des-Sables wind farm is located near Matane in the province of Québec. It is a 109.5-MW wind farm of which the Fund has acquired a 38% financial interest. The facility benefits from a long-term Power Purchase Agreement with a term of 20 years with Hydro-Québec, expiring in 2026. The facility was commissioned in November 2006, and is expected to produce 298.3 GW-hr annually (113.4 GW-hr net interest). For the first 9 months of 2007, the Baie-des-Sables wind farm performed 13.8% above its forecasted long-term average due to winds proportionately stronger than expected for that period.
The Anse-à-Valleau wind farm is located in Gaspé, in the province of Québec. It is a 100.5-MW wind farm of which the Fund has acquired a 38% financial interest. The facility benefits from a long-term Power Purchase Agreement with a term of 20 years with Hydro-Québec, expiring in 2027. The facility was commissioned in November 2007, and is expected to produce 298 GW-hr annually (113.2 GW-hr net interest).
The Fund financed the acquisition price of $172.9 million by issuing 4,724,409 units to the vendor, representing an amount of $61.7 million, by assuming $108 million in non-recourse debts and by increasing the Fund's debt by $3.2 million. The interest rate risk of such debts is mitigated by way of derivative instruments. The trusts units issued for the purpose of the acquisition are now held by Innergex Renewable Energy Inc., the manager of the Fund, which therefore owns 16.1% of the Fund's outstanding units.
In connection with the acquisition, the Fund has agreed to certain amendments to its management agreements with its manager, including: i) the extension of their initial terms from 2023 to 2030; and ii) mutual rights to terminate the agreements upon certain events and provided that a cash compensation is paid to the manager.
Fasken Martineau represented Innergex Power Income Fund with a team comprised of Robert Paré, Marie-Josée Neveu, Frédéric Boucher, Jean-Michel Lapierre and Rebecca McLeod (corporate/securities) and Thomas Copeland (tax).