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Ormat sells 37% equity stake in 20.5 MW unit of geothermal plant in Nevada

Ormat sells 37% equity stake in 20.5 MW unit of geothermal plant in Nevada Don A. Campbell Geothermal Power Plant of Ormat, Nevada (source: Ormat Technologies)
Alexander Richter 24 Nov 2016

Ormat Technologies has announced that its subsidiary Ormat Nevada has closed the sale of a 36.75% equity stake in the 2nd phase of the 20.5 MW Don A. Campbell geothermal power plant in Nevada for $44.2 million to Northleaf Capital Partners.

In an announcement today, Ormat Technologies, Inc. reports “that its wholly-owned subsidiary, Ormat Nevada Inc. (Ormat), closed a follow-on equity transaction with Northleaf Capital Partners (Northleaf).

Northleaf purchased a 36.75% equity interest in the second phase of the Don A. Campbell power plant for a purchase price of $44.2 million. The 20.5 MW second phase of the Don A. Campbell geothermal power plant commenced operation in September 2015 and sells its electricity to Southern California Public Power Authority under a 20-year Power Purchase Agreement. Following the closing, the power plant was contributed to the existing ORPD joint venture, as agreed upon under the terms of ORPD’s limited liability company agreement executed by Ormat and Northleaf on April 30, 2015. The purchase price of $44.2 million implies a total transaction value of approximately $120 million and represents approximately 11.5x multiple on the second phase of Don A. Campbell’s 2016 estimated EBITDA and adjusted EBITDA.

“The successful monetization of the second phase of Don A. Campbell power plant validates the excellent relationship we have established with Northleaf, and demonstrates that Northleaf continues to see value in acquiring equity interests in our plants,” commented Isaac Angel, Chief Executive Officer, Ormat. “The performance of ORPD’s existing portfolio, as well as the new addition of Don A. Campbell 2, are in line with the parties’ expectations, and we expect to achieve additional milestones that will benefit both Ormat and Northleaf. The proceeds from this transaction will further strengthen our balance sheet and support our expansion plans and future strategic opportunities.”

“We are delighted to have successfully completed our planned acquisition of Don A. Campbell 2, broadening our existing ORPD joint venture alongside our partner Ormat, a world leader in geothermal development and operations,” said Olivier Laganière, Vice President, Northleaf. “This transaction is an example of Northleaf’s strategy of investing in proven, conservatively-positioned contracted assets in OECD jurisdictions alongside like-minded operating partners, thereby providing our investors with the potential for long-term, stable returns.”

Source: Ormat release via Stockhouse