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Innergex divestment of Icelandic geothermal firm to close Q2 2019

Svartsengi geothermal power plant, Iceland (source: ThinkGeoEnergy)
Alexander Richter 16 May 2019

Innergex expects the closure of its divestment of Icelandic geothermal player HS Orka to conclude in Q2 of 2019.

In a release on its financial results for Quarter 1 of 2019, Canadian Innergex shares details on the divestment of its Icelandic assets.

On March 25, 2019, Innergex announced that an agreement has been reached to sell its wholly owned subsidiary Magma Sweden which owns an equity interest of approximately 53.9% in HS Orka for a purchase price of US$304.8 million (approximately CAN$408.8 million) to a Macquarie Infrastructure and Real Assets managed European infrastructure fund, subject to customary closing adjustments.

The transaction is subject to the satisfaction of certain closing conditions, including receipt of key third party consents, a right of first refusal in respect of the shares of Magma Sweden (exercisable for two months on the same terms and conditions), as well as other customary conditions. All required conditions are expected to be satisfied in the second quarter of 2019 with closing of the transaction to be completed after the satisfaction of such conditions.

Net proceeds will be used to reimburse the $228 million one-year credit facility contracted in October 2018 at the time of the acquisition of the remaining interest in the Cartier Wind Farms and Operating Entities, to deleverage corporate facilities and for general corporate purposes. On April 23, 2019, the one-year credit facility was amended to add additional capacity of $100 million to be drawn as needed.