TransCanada To Buy Bruce Power Stakes From British Energy
Monday December 23, 7:23 am ET
TIVERTON, Ont. - TransCanada PipeLines Ltd. , Cameco Corp. ( CCJ) and BPC Generation Infrastructure Trust detailed their purchase of British Energy Plc's 82.4% interest in Bruce Power Limited Partnership.
In a press release, the group said it has entered into a binding agreement that will see the group acquire 79.8% of British Energy's share in Bruce Power L.P. The consortium will also take over British Energy's financial assurance obligations to Bruce Power regarding its Canadian Nuclear Safety Commission licence and power purchase agreements with customers.
On financial close, which is expected to occur before Feb. 14, the Power Workers' Union, or PWU, and the Society of Energy Professionals (The Society) will assume British Energy's remaining 2.6% share, increasing the unions' equity stake to a combined 5.2%.
Under the revised partnership, Cameco will increase its current 15% interest of Bruce Power to 31.6%. TransCanada and BPC Generation Infrastructure Trust, a trust established by the Ontario Municipal Employees Retirement System, will also each hold 31.6% of Bruce Power, while the PWU will own 4% and the Society will own 1.2%.
The Bruce Power consortium will also acquire the 50% interest that British Energy holds in Huron Wind, Ontario's first commercial wind farm, which is adjacent to the Bruce Power Visitors' Center. A partnership with Ontario Power Generation Inc. , Huron Wind's five 1.8 MW turbines generate enough clean electricity for 3,000 homes.
British Energy expects to receive total consideration of C$770 million, subject to various contingencies and potential adjustments. Of this consideration, British Energy will receive C$630 million in cash at closing subject to certain adjustments.
As well, the group will pay C$100 million to British Energy to fund a one-time estimation and restructuring fee of C$100 million to the Ontario government in consideration of the province consenting to the transaction and C$220 million will be paid into trust accounts to cover estimated outstanding tax liabilities, pension-fund deficits, any successful claims in respect of customary representations and warranties and payments contingent on the restart of Bruce A Units 3 and 4. Subject to adjustment, the total consideration payable by the consortium is expected to be C$950 million.
As part of the transaction, British Energy will receive C$50 million of the money placed in trust should Bruce A Unit 4 be returned to service by June 15, and another C$50 million if Unit 3 is restarted by Aug. 1.
Company Web Sites: transcanada.com and cameco.com |
