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Bethesda’s TerraForm acquires wind farms for $350M

Atlantic Power Corp. agreed to sell its wind farms to Bethesda-based TerraForm Power Inc. for $350 million, giving the company a cash injection after it failed to find a buyer last year.

The five operating wind farms in Idaho and Oklahoma can produce as much as 521 megawatts of electricity and include contracts to sell their output to utilities with an average life of 18 years, TerraForm said in a statement Wednesday. TerraForm went public last year and has been acquiring power projects from its parent, renewable-energy developer SunEdison Inc., and other sellers.

Atlantic Power, owner of power plants in the U.S. and Canada, said in September it had not found a buyer or merger partner after conducting a strategic review of its options. The stock fell 22 percent last year, after declining 70 percent in the prior year.

TerraForm expects the plants will generate adjusted earnings before interest, taxes, depreciation and amortization of $56 million a year on average during the next decade. It will also assume debt from the plants. TerraForm surged 1.3 percent to $36.98 after touching an intraday record.

“We are grateful for the opportunity to work with Atlantic Power,” said Carlos Domenech, Chief Executive Officer of TerraForm Power. “This landmark transaction illustrates the strength and agility of the combined TerraForm-SunEdison platform as well as the robustness of our proprietary deal pipeline. We expect the warehouse facility to be an innovative financing structure that provides repeatable and scalable funding to secure future growth; we expect the drop down returns to be at parity with the acquisition yields.”

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