Meridian Energy has entered into a Scheme Implementation Agreement (SIA) with NZ Windfarms Limited (NZWF), paving the way for the acquisition of all NZWF shares through a court-approved Scheme of Arrangement.
Under the agreement, Meridian will purchase the shares for $0.25 in cash per share, valuing NZWF’s equity at $91 million.
Meridian said in an ASX announcement that the deal remains subject to approval from NZWF shareholders and the High Court.
Meridian and NZWF already share a 50-50 joint venture focused on repowering the Te Rere Hau Wind Farm in Manawat?, which also includes Meridian purchasing 100% of the power generated from the site. Meridian currently holds a 19.99 per cent stake in NZWF.
The NZWF Board has unanimously recommended that shareholders vote in favour of the scheme, contingent on the Independent Adviser’s report concluding that the offer is within or above its valuation range for NZWF shares. Additionally, the recommendation holds in the absence of a superior proposal.
Major shareholders Robert Stone and Salt Funds Management, who together own approximately 14 per cent of NZWF, have indicated their support for the transaction and signed voting deeds committing their shares in favour of the scheme.
Meridian Energy Chief Executive Neal Barclay emphasised the strategic benefits of the acquisition, stating that the scheme, if successful, would provide value to NZWF shareholders while enabling more efficient financing of the Te Rere Hau repowering project.
“Meridian is already the largest shareholder in NZWF and is also party to a 50-50 joint venture to repower NZ Windfarms’ largest asset, the Te Rere Hau Wind Farm in Manawat?,” Barclay said.
“If the scheme of arrangement is successful, it will reward NZWF shareholders for the value created to date, while also enabling more efficient financing of the Te Rere Hau repowering project.”
The Te Rere Hau repowering initiative involves designing, constructing, and operating up to 39 new turbines, increasing the generation capacity to 170MW.
According to Barclay, the project has the potential to generate seven times the annual renewable energy production of the current turbines.
Barclay highlighted that Meridian’s Harapaki wind farm in Hawke’s Bay has demonstrated the advantages of using modern turbines at an optimal site, and a similar approach at Te Rere Hau could provide economic and environmental benefits.
“This project will create regional jobs and business opportunities, further strengthen security of supply and create value for both sets of shareholders,” he added.
Meridian is being advised by Russell McVeagh and Clare Capital in the transaction.
