Ormat raises $92.5 m in refinancing of geothermal plant in Nevada
Ormat Technologies has raised $92.5 million in a private placement with the asset management arm of German MunichRe, which helps refinance the Don A. Campbell Phase 1 geothermal power plant in Nevada, U.S.
In a release today, Ormat Technologies, Inc. (NYSE:ORA) “announced that ORNI 47 LLC successfully issued and sold $92.5 million in aggregate principal amount of its 4.03% Senior Secured Notes due 2033. The Senior Secured Notes were issued in a private placement transaction exempt from the registration requirements of the Securities Act of 1933, as amended, and were purchased in total by MEAG, the asset manager of Munich Re. The Senior Secured Notes were assigned an investment grade rating of BBB- by Kroll Rating Agency.
ORNI 47 LLC issued the Senior Secured Notes to refinance the costs of development and construction of the Don A. Campbell Phase I (DAC 1) geothermal power plant, which Ormat initially financed using equity funding. The approximately 20 MW DAC 1 geothermal power plant is located in Nevada, and commenced operation in 2014. ORNI 47 LLC, which owns the plant, sells its electricity to Southern California Public Power Authority under a 20-year Power Purchase Agreement. ORNI 47 LLC and the DAC 1 plant form part of the ORPD LLC portfolio, which is jointly owned 63.25% by Ormat’s direct wholly-owned subsidiary Ormat Nevada Inc., and 36.75% by Northleaf Geothermal Holdings LLC, an affiliate of Northleaf Capital Partners. Ormat Nevada’s share of the proceeds, net of transaction fees and funding of a debt service reserve account, are approximately $55.0 million.
“We are pleased to finalize this financing transaction for Don A. Campbell Phase I, enabling Ormat and Northleaf to benefit from favourable terms. This financing demonstrates Munich Re’s confidence in geothermal projects operated by Ormat,” said Mr. Isaac Angel, Chief Executive Officer of the Company.
“With this investment we are continuing to diversify our portfolio with sustainable investments characterized by limited risks and attractive returns. In doing so we are making use of the entire group’s expertise,” says MEAG Managing Director Holger Kerzel.
CIBC World Markets Corp. acted as Private Placement Agent and Chadbourne & Parke LLP served as legal counsel.
Source: Ormat release