Northland Power has agreed to purchase a 99.2 percent interest in the Colombian utility Empresa de Energía de Boyacá (EBSA) in a COP 2,665 billion ($1.05 billion) deal, including existing debt.
The seller was Fondo de Capital Privado de Infraestructura Brookfield Colombia and BCIF Holdings Colombia II.
EBSA is the only electricity distribution company for the department of Boyacá, a region near Colombia’s capital, Bogotá. The deal marks Northland’s second investment in Latin America. In May, the company broke ground on its 130-megawatt La Lucha solar project in Mexico.
“The acquisition builds on our presence in Latin America and gives us an entry point into Colombia, a target market with a stable economy, growing middle class, strong rule of law and ease and transparency of doing business,” said Mike Crawley, president and CEO at Northland. “EBSA operates in a stable regulatory framework offering an inflation-protected perpetual–cash flow profile and serves as a platform for future growth.”
EBSA derives the majority of revenue from its regulated utility business.
The acquisition will be funded initially with a fully committed 12-month $1.1 billion bridge facility, according to Northland Power. It will finance the purchase through $315 million of gross proceeds in common equity via a concurrent bought deal public offering of subscription receipts. An additional $450 million to $500 million of nonrecourse debt financing supported by the EBSA business will be arranged shortly after the anticipated closing of the acquisition.
The acquisition is expected to close in the fourth quarter of 2019.
