Monday 15th March 2021
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Mercury NZ Limited (Mercury) has announced that, together with Powering Australian Renewables (PowAR), it has entered into a Scheme Implementation Agreement (SIA) with Tilt Renewables Limited (Tilt) (NZX, ASX ticker code TLT). Under the terms of the transaction, PowAR will acquire all the shares of Tilt (including Mercury’s shares) for NZ$7.80 per share, and Mercury will acquire all of Tilt’s New Zealand operations, including development options, for an enterprise valuation of approximately NZ$770m. PowAR will retain ownership of all of Tilt’s Australian assets.
Mercury Chief Executive Vince Hawksworth acknowledged Tilt’s successful renewable energy generation development programme in New Zealand and Australia, which he said reflected great work by the team at Tilt over the past five years.
“Mercury is excited to have partnered with PowAR to make this compelling offer for Tilt,” Mr Hawksworth says.
“Throughout this transaction, Mercury has worked to keep these New Zealand assets under New Zealand ownership. Completion of this transaction will position Mercury to make an even more significant contribution to New Zealand’s de-carbonisation goals.
Tilt’s New Zealand wind operations combined with our Turitea windfarm, which is currently under construction, would represent almost 5% of New Zealand’s total generation. Mercury’s decision to invest in Tilt in 2018 has made this transaction possible and it will be immediately earnings accretive for MCY shareholders,” Mr Hawksworth says.
PowAR Chairman Cheryl Bart said: “Tilt has built a world-class portfolio of high-quality renewable energy assets and development opportunities that will complement our existing assets. We’re delighted to be able to work constructively with Tilt and Mercury NZ on this exciting opportunity, which is absolutely aligned to our mission of leading the transition to a decarbonised, decentralised and digitised energy system.”
The acquisition of the New Zealand operations by Mercury will be funded from the sale of Mercury’s 19.9% Tilt shareholding, worth NZ$585m and net debt of NZ$185m and are forecasted to lift Mercury’s earnings (EBITDAF) in FY2022 by $50m. The acquired Tilt assets will increase Mercury’s total annual generation by over 1,100GWh and include several prospective development options.
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