Invenergy hauls in $2 billion from sale of wind farms


Crain’s Chicago Business

In the largest sale it has made to date, Invenergy is divesting seven wind farms in the U.S. and Canada for $2 billion.

The Chicago-based power developer, majority-owned by longtime energy entrepreneur Michael Polsky, struck a deal, announced today, to sell the 930-megawatt portfolio to TerraForm Power, an affiliate of Maryland Heights, Md.-based renewable energy developer SunEdison.

All the facilities sell their output under long-term contracts. Invenergy will retain a 9.9 percent stake in the portfolio when the transaction closes and will continue to operate and maintain the wind farms.

The deal is slated to close in the fourth quarter.

Invenergy declined today to disclose the location of the wind farms, leaving that news to come from SunEdison.

VALUE OF WIND POWER UP

The 930 megawatts represents about a tenth of Invenergy’s projects under long-term contracts. All told, the company has developed or will develop more than 9,000 megawatts of renewable and natural gas-fired power-generating capacity that’s under contract.

The $2 billion purchase price shows how much wind power has increased in value in just a few years. For context, Chicago-based Exelon, the nation’s largest operator of nuclear power plants and owner of Chicago utility Commonwealth Edison, purchased 735 megawatts of wind power for $900 million just five years ago. About 75 percent of that portfolio, previously owned by Deere, was under contract at the time.

“Demand for high-quality assets with long-term contracts in that (clean energy) market has strengthened,” Polsky said in an interview.

Invenergy put the projects on the market, hiring Goldman Sachs to handle the sale, as a way to raise capital for future projects, he said.

“This represents a commitment by us to grow even more,” he said.

Polsky, Invenergy’s president and CEO, described the sale as the best way, given market conditions now, for the privately held company to raise capital. But he cautioned that conditions could change, so Invenergy could access the market differently the next time it needs money for investment purposes.

Retrieved from Crain’s Chicago Business