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Ontario Power to acquire Eagle Creek Renewable for US$298M

Ontario Power Generation Inc. agreed to acquire Eagle Creek Renewable Energy, an operator of small hydropower facilities in the U.S., for US$298.0 million.

Eagle Creek owns and operates a 216-MW portfolio of 63 small hydro facilities primarily located in the Northeast and Midwest. The company also has ownership interests in 13 other hydroelectric assets and two solar facilities in New England representing 10 MW of capacity.

Upon completion, Eagle Creek will become a subsidiary of Ontario Power. The deal is subject to U.S. regulatory approvals.

"By expanding our core business with this purchase, OPG is capitalizing on a new growth opportunity by making an investment in a strategic set of hydroelectric assets that will produce an attractive return for our shareholder, the Province of Ontario," Ontario Power President and CEO Jeff Lyash said in the company's Aug. 9 earnings release.

The company plans to finance the transaction without taxpayer money. The purchase will have no impact on Ontario's electricity customers.

On the earnings front, Ontario Power Generation reported net income attributable to shareholders of C$121 million in the second quarter, compared to C$303 million in the same quarter of 2017.

Revenue was up to C$1.28 billion from C$1.15 billion a year earlier, while total electricity generation was down to 17.2 TWh, compared to 18.0 TWh a year ago.

Cash flow from operating activities totaled C$413.0 million, from C$89.0 million in the second quarter of 2017.

The company also received a 10-year operating license from the Canadian Nuclear Safety Commission to continue operations at the 3,100-MW Pickering station until the end of 2024 "and then conduct the work needed through to 2028 to place the station in a safe state as the initial part of the decommissioning process," Lyash said.