Innergex Renewable Energy has entered into an agreement with Irradiant Partners, LP to sell minority interests in three of its renewable energy facilities in Texas.
This transaction, valued at CAD 257 million, aims to reduce risks associated with Innergex’s Texan assets and strengthen its financial position.
Strategic Partnership and Financial Implications
Innergex is divesting 49.9% of the Phoebe and Griffin Trail facilities, and 22.2% of the Foard City facility to Irradiant Partners, an investment manager based in Los Angeles. The CAD 257 million proceeds will primarily be used to repay project debts for Foard City and Phoebe, and to terminate the power hedge contract at Phoebe.
The remaining funds will be allocated for general corporate purposes. This partnership allows Innergex to retain operational control of its assets while optimizing their performance and improving their risk profile.
Transaction Structure and Asset Management
The transaction involves the sale of specific stakes: 49.9% in Phoebe (250 MW solar facility) and Griffin Trail (225.6 MW wind facility), and 22.2% in Foard City (350.3 MW wind facility). Innergex will continue to oversee operations and maintain its professional teams on-site. The aim is to stabilize the revenue structure of the facilities, particularly for Foard City and Griffin Trail, which will experience no changes in their revenue streams.
Growth Prospects and Risk Management
Michel Letellier, CEO of Innergex, emphasizes that this partnership with Irradiant allows them to unlock the value of their operational assets in Texas while exiting the energy hedge model. This strategy aims to enhance the company’s overall risk profile and optimize asset performance. The transaction enables Innergex to strengthen and deleverage its balance sheet, a crucial step for future growth.
Impact on Innergex’s Portfolio
Innergex, primarily operating in Canada, the United States, France, and Chile, manages a diversified portfolio of hydroelectric, wind, solar, and energy storage facilities. This transaction presents a strategic opportunity for Innergex to improve the quality and resilience of its energy portfolio while generating sustainable cash flows and delivering attractive returns to its shareholders.
Location of Facilities
The facilities involved in this transaction are located in different Texas counties: Foard City in Foard County, Griffin Trail in Knox and Baylor Counties, and Phoebe in Winkler County. With a combined installed capacity of over 826 MW, these sites represent a significant portion of Innergex’s portfolio in the United States.