Western Wind Energy, the Canadian wind developer who urged its shareholders to reject a $145 million takeover bid from Algonquin Power and Utilities last October, said Monday it will be putting itself and its assets on the block to be sold.
The Vancouver-based firm, in a statement, said that "a decision has been made by the board of directors, in consultation with the CEO, that effective immediately the entire company and its producing assets" — three wind farms in California with combined capacity of 154.5 MW and a 10.5 MW combined wind and solar facility in Arizona — "will be made available for sale."
The firm, which is still hoping to collect $12 million it feels it was deprived of in a $78.3 million reimbursement from the US Treasury Department's 1603 program, indicated it feels it is being pushed into the sale.
The Monday statement signed by Jeffrey Ciachurski, the firm's founder, president and CEO, said that Western Wind's decision to sell "was based on a compromise between the CEO's plan of building the assets for another two years before contemplating a sale, and the consistent suffering our shareholders have endured by unregulated market participants trading the stock price down to levels that only serve to frustrate and 'shake out' retail investors."
Algonquin's offer last fall valued Western Wind's shares at $2.50/share. Ciachurski rejected what he called at the time a "low-ball" offer. Over the past nine months the company's stock has fallen to as low as $1.18/share, which is where it closed on Friday.
After Monday's sale plan announcement, Western Wind's stock surged to over a $1.70/share.
Western Wind owns the 120-MW Windstar wind project in Tehachapi, California, that has a 20-year power purchase agreement with Southern California Edison and cost approximately $260 million to build.
The company received a $78.3 million 1603 reimbursement July 9 from Treasury for the project. Western Wind said, however, it put in a claim for a $90 million reimbursement. During a conference call on July 16, Ciachurski said he was intending to go to Washington and discuss with Treasury why the reimbursement was $12 million lower than his claimed construction costs.
Treasury did not respond to questions about Western Wind on Monday, but has said previously that the company — any company — can appeal their reimbursement. However, Treasury also indicated that developer fees and their magnitudes can be scrutinized if paid, for example, between affiliates.
Western Wind is also selling its 30-MW Mesa wind farm in San Gorgonio Pass near Palm Springs, California, that has 20-year PPA with San Diego Gas & Electric, and the 4.5 MW Windridge facility in Tehachapi that has a PPA with Southern California Edison that runs through 2014.
The company's 10.5 MW combined wind and solar PV facility near Kingman, Arizona, has a 20-year PPA with Unisource Energy Corp.
