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Canadian firm Polaris Renewable Energy Inc. announced Tuesday that it has closed on the equity capital contribution agreement and LLC agreement with respect to the Punta Lima Wind Farm LLC, a wholly owned subsidiary of Santander Bank N.A.
The project is an operating onshore wind farm called Punta Lima Wind Farm with a nameplate capacity of 26.0 megawatts located in Naguabo. The project was reconstructed and recommissioned by Santander following the 2017 hurricane season and has a 20-year power purchase agreement in place with the Puerto Rico Electric Power Authority terminating in March 2044.
The transaction has been completed using a tax-equity structure which results in Polaris becoming the manager and operator of the project with a controlling equity interest and Santander retaining a tax equity interest in the project. The transaction was subject to customary closing conditions, which principally consisted of approval of the acquisition by local regulatory bodies as well as the execution of the corresponding LLC agreement. The total equity contribution of $20 million from Polaris was subject to customary closing adjustments including working capital changes. Santander Corporate & Investment Banking acted as sole financial adviser to Santander Bank N.A.
“This strategic acquisition further deploys Polaris capital into another jurisdiction while adding wind into our generation mix,” said Marc Murnaghan, president and CEO of Polaris. “We believe that this transaction provides attractive near-term returns to our shareholders as well as enhancing our growth opportunities significantly. This includes the use of energy storage to provide competitively priced energy and grid stabilization services as well as exploring further strategic opportunities on the island given its stated future energy requirements.”
“Santander is proud to have rebuilt the Punta Lima wind farm in Puerto Rico and is very pleased to be selling its interest to a specialist partner in Polaris,” said Nuno Andrade of Santander Corporate & Investment Banking. “It was the right thing to do to support the island’s clean energy efforts and we are very happy with this outcome.”
Polaris Renewable Energy Inc., based in Toronto, Ontario, is a publicly traded company engaged in the acquisition, development, and operation of renewable energy projects in Latin America & the Caribbean.
