Innergex Renewable Energy Inc. (TSX: INE) has successfully closed a $185.5 million non-recourse project financing, including 179.9 million in term loans at an effective interest rate of 6.14%, along with a $5.5 million reserve facility, with The Canada Life Assurance Company. The funds will primarily be allocated to a portfolio of unlevered Canadian hydroelectric facilities, enhancing the Gilles-Lefrançois, Miller Creek, and Rutherford Creek assets, all currently operational. The term loans are structured to mature in 2038 and 2043, aligning with the remaining duration of the power purchase agreements for these facilities.
Michel Letellier, President and Chief Executive Officer of Innergex, emphasized the significance of this financial move, stating: “This step underscores our commitment to strengthening our financial position and ensuring long-term financial flexibility to continue our growth. By financing unencumbered assets, we are taking proactive steps to substantially reduce our corporate debt."
The strategic use of the proceeds is aimed at repaying the corporate revolving credit facility, a move expected to significantly reduce the corporate leverage. Letellier further highlighted the recent achievements of Innergex, including securing financing for the Boswell Springs wind project and establishing a long-term partnership agreement in France, showcasing the company's dedication to executing its funding strategy for increased liquidity and sustained growth.
Brian Allison, Executive Vice-President and Chief Investment Officer of Canada Life, expressed the company's commitment to supporting Innergex's renewable hydroelectric facilities, stating: "We are very pleased to support Innergex with this financing of renewable hydroelectric facilities. We are committed to an investment strategy that generates value while supporting energy security, transition, and sustainability in Canada."
Financed assets:
- Gilles-Lefrançois (Quebec) - 24MW, commissioned in 1999, power purchase agreement expiring in 2039
- Miller Creek (British Columbia) - 33MW, commissioned in 2003, power purchase agreement expiring in 2043
- Rutherford Creek (British Columbia) - 50MW, commissioned in 2004, power purchase agreement expiring in 2044
