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Maxim Power to sell US subsidiary to Hull Street Energy


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Maxim Power to sell US subsidiary to Hull Street Energy

Maxim Power Corp. entered an agreement to sell its 100% ownership interest in wholly owned subsidiary Maxim Power (USA) Inc. to an affiliate of Hull Street Energy LLC for $106 million.

Net proceeds to Maxim after accounting for debt and transaction costs are expected to be $84 million, the company said on Dec. 23.

Maxim Power (USA) owns and operates Maxim's five natural gas-fired electric generation facilities in the U.S., with an aggregate generating capacity of 446 MW.

The company intends to hold a special meeting of its shareholders to seek approval of the transaction in February 2017.

Maxim noted that its shareholders, including all of its directors and officers, who collectively own or control about 42% of the outstanding common shares, have committed to vote in favor of the transaction. Additionally, the company's board unanimously approved the terms of the agreement and recommended that shareholders vote in favor of the deal at the special meeting.

The transaction is expected to close during the first quarter of 2017, subject to receipt of all applicable regulatory and shareholder approvals and completion of the buyer's financing.

Proceeds will be used by the company for strategic corporate purposes, including the potential opportunity to invest in new projects in Alberta's power market, which is expected to undergo significant reforms in the coming years, the company said.

Credit Suisse is acting as financial adviser to Maxim's board on the proposed transaction.