Innergex Renewable Energy Inc. announced July 5 that Energía Llaima SPA, with which it has a joint venture partnership, has completed the acquisition of the 140-MW Duqueco hydroelectric project in Chile, consisting of two facilities.
The purchase price for the plant is $210 million, according to a July 5 news release, net of $10 million of cash. To fund the acquisition, Innergex has secured a $130 million, 15-year term financing with South American bank Itaú that includes a $70 million bullet loan. The bullet loan carries a variable interest rate, to which Innergex said it plans to reduce exposure by entering into long-term hedging instruments.
Energía Llaima's remaining net share of the purchase price is $80 million. Innergex will fund the $80 million and Energía Llaima's $10 million deposit through its revolving credit facilities.
Innergex announced July 3 that it purchased a 50% stake in Energía Llaima for $110 million, $10 million of which was paid upfront and the remainder was to be funded over the next 12 months. The remaining investment in the Chilean company included $90 million that Innergex agreed to pay as part of the Duqueco acquisition. With the acquisition of the hydroelectric facility, Innergex said its commitment to invest $110 million in Energía Llaima over a 12-month period is almost reached.
Operational since 2001, the Duqueco power plant consists of the 85-MW Peuchen facility and 55-MW Mampil facility, located on the Duqueco river, about 60 km east of the city of Los Angeles, Chile. The Peuchen plant has a reservoir upstream with a 4-hour regulation at full capacity and up to 12-hour regulation at partial capacity, which also benefits Mampil, according to the release. The plant has a 20-year power purchase agreement, at fixed prices until 2020, and on the spot market.
Innergex forecast adjusted EBITDA for Duqueco of approximately $21 million.