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Algonquin asks FERC to approve stake transfer deal for 2 Atlantica solar farms

Algonquin Power & Utilities Corp. filed an application with the Federal Energy Regulatory Commission to authorize the transfer of an indirect controlling stake in two solar power plants as a result of its acquisition of a 25% stake in Atlantica Yield plc.

The two facilities involved in the transaction are the gross 280-MW Solana solar farm in Maricopa, Ariz., and the 280-MW Mojave Solar plant in San Bernardino, Calif. Atlantica Yield will remain in control of the day-to-day activities at the plants upon deal closing.

If approved by FERC, the stake will be transferred to Abengoa-Algonquin Global Energy Solutions and/or to Algonquin Power through one or more acquisitions of shares of Atlantica Yield.

Abengoa-Algonquin Global Energy is a joint venture to be formed and owned 50% by Algonquin Power through a subsidiary, and 50% by Abengoa, for the purpose of global infrastructure projects, according to a Dec. 8 FERC filing.

Under the purchase agreement signed in November, Algonquin will acquire a 25% stake in Atlantica Yield from Abengoa SA for $608 million in cash, with an additional 60 cents per share contingent payment subject to certain conditions payable two years after closing. Algonquin also has an option to an additional 16.47% stake in Atlantica Yield from the parent company.

The deal also requires U.S. Department of Energy's authorization as it triggers certain minimum ownership requirements contained in the DOE-guaranteed financing arrangements for the two facilities.

The parties are seeking expedited consideration of the transaction in a bid to close the first step of transactions in January 2018. (FERC docket EC18-30)