Northland Power Announces Acquisition of Colombian Regulated Utility Business for $1.05 Billion and Concurrent $315 Million Equity Financing

Not for distribution to U.S. newswire services or for dissemination in the United States or its possessions. Any failure to comply with this restriction may constitute a violation of U.S. securities law.


  • Expands Northland’s Latin American platform into the growing Colombian electricity sector

  • Marks Northland’s entry into the regulated utility industry complementing its existing portfolio of contracted power assets

  • Adds a business that is the sole electricity distributor to a population of over 1.3 million residents

  • Offers a highly predictable revenue and cash flow profile, inflation protection and growth from its regulated rate base

  • Establishes a platform for further growth across all electricity segments in Colombia due to EBSA’s specific grandfathered regulatory rights

  • Generates average mid-single digit accretion to Free Cash Flow per Share during the current regulatory period ending 2023 and increasing accretion over the long-term

  • Is prudently financed in-line with Northland’s investment principles and strong credit rating providing ample flexibility to fund future growth initiatives

TORONTO, Sept. 09, 2019 (GLOBE NEWSWIRE) -- Northland Power Inc. (“Northland”) (TSX: NPI) today announced it entered into an agreement to purchase a 99.2% interest in the Colombian regulated utility Empresa de Energía de Boyacá (“EBSA”) from Fondo de Capital Privado de Infraestructura Brookfield Colombia and BCIF Holdings Colombia II S.A.S. (collectively, “Brookfield Infrastructure”) (the “Acquisition”) for COP 2,665 billion ($1.05 billion), including existing debt, and subject to certain purchase price adjustments following receipt of final approval of EBSA’s tariff by the Colombian energy and utility regulator.

“The Acquisition builds on our presence in Latin America and gives us an entry point into Colombia, a target market with a stable economy, growing middle class, strong rule of law and ease and transparency of doing business” noted Mike Crawley, Northland’s President and Chief Executive Officer. “We are thrilled to be acquiring this high-quality regulated Colombian utility. EBSA operates in a stable regulatory framework offering an inflation-protected perpetual cash flow profile and serves as a platform for future growth.”

Expands Northland’s Latin American Energy Infrastructure Business into Colombia

EBSA is Northland’s second investment in Latin America following the start of construction of its 130 MW La Lucha solar project in the State of Durango in Mexico in May 2019, and is an attractive entry point into the Colombian energy market.

Colombia is the 3rd largest population center in Latin America with nearly 50 million residents and a growing middle class. Colombia has experienced strong economic growth with real GDP growth averaging 3.5% over the past 10 years and over 400% growth in foreign direct investment since the early 2000s.

Colombia is a member of the Organization for Economic Co-operation and Development and a highly creditworthy jurisdiction, maintaining an investment grade credit rating as assessed by S&P (BBB-), Moody’s (Baa2) and Fitch (BBB) since 2011. Strong economic and demographic fundamentals coupled with a supportive government and prudent fiscal policies are expected to support significant investment in the infrastructure sector in the coming years.

EBSA is one of a few energy companies in Colombia with favourable grandfathered rights allowing for vertical integration and participation in all segments of the electricity supply chain. With its grandfathered status and strong management team, EBSA will allow Northland to participate across the energy infrastructure spectrum in Colombia.

Adds a High-Quality Regulated Utility Business

EBSA is the sole electricity distribution company for the department of Boyacá, a prosperous region located near the capital, Bogotá, with abundant natural resources and a growing economy supported by agricultural, mining, and industrial industries. EBSA serves a population of 1.3 million residents across 123 municipalities and is one of the ten largest electricity distributors in Colombia. 

EBSA has a strong track record of executing value enhancing projects in the distribution and transmission segments, improving operating performance and customer service. Key management team members have been with EBSA for an average of 16 years and are expected to lead EBSA going forward.

EBSA operates under a regulatory framework with the majority of revenue derived from its regulated utility business. The current remuneration methodology for the distribution sector provides distributors with substantially fixed remuneration based on net depreciated assets, inflation indexation based on an established Colombian price index, and an average approved WACC of approximately 11.5%.

Based on the current tariff application, EBSA’s rate base for 2019 is approximately COP 1,600 billion ($630 million). EBSA’s regulated rate base is expected to grow through regulatory inflation indexation and net rate base investments which are expected to be self funded through cash from operations and non-recourse debt.

Strong Financial Contribution

The Acquisition is an important step in further diversifying Northland’s portfolio by adding a perpetual utility infrastructure business in Latin America to its high-quality portfolio of contracted electricity generating facilities in North America and Europe.

Based on the submitted tariff, EBSA is expected to contribute Adjusted EBITDA in 2020 of approximately COP 255 billion. At the current COP exchange rate of 2,540, the equivalent Canadian dollar Adjusted EBITDA is approximately $100 million.

The Acquisition is expected to generate average mid-single digit accretion to Free Cash Flow per Share during the current regulatory period ending 2023, and increasing accretion over the long-term.

Prudent Financing Plan

The Acquisition will be funded initially with a fully committed 12-month $1.1 billion bridge facility.

Northland’s long-term financing plan for EBSA is designed to be consistent with Northland’s strong investment grade credit rating. Northland intends to permanently finance the Acquisition and related expenses through:

  • $315 million of gross proceeds in common equity via a concurrent bought deal public offering of subscription receipts (the “Subscription Receipts”), before any exercise of over-allotment option. As described in more detail below, each subscription receipt will entitle the holder to receive one common share of Northland upon closing of the Acquisition,

  • $450 to $500 million of non-recourse debt financing supported by the EBSA business which is expected to be arranged shortly after the anticipated closing of the Acquisition, and

  • the balance of the Acquisition will be funded with cash on hand and borrowings under Northland’s corporate credit facilities.

To mitigate the effects of exchange rate movements, Northland expects to issue a portion of the non-recourse debt in Colombian Pesos, and to implement a rolling multi-year currency hedging program for remaining free cash flow subject to exchange rate fluctuations.

Approvals & Timetable

The Acquisition Agreement includes customary closing conditions as well as a closing condition for receipt of final approval of EBSA’s tariff by the Comisión de Regulación de Energía y Gas (“CREG”), the Colombian energy and utility regulator. The Acquisition purchase price is subject to certain adjustments based on the final tariff approved by CREG, which are intended to protect Northland’s economic return in the event of a change in the overall tariff.

Northland expects receipt of the tariff approval by CREG in the coming months and closing of the Acquisition in the fourth quarter of 2019.

Subscription Receipt Offering

Concurrent with the announcement of the Acquisition, Northland entered into an agreement with a syndicate of underwriters (the “Underwriters”) co-led by CIBC Capital Markets and National Bank Financial pursuant to which the Underwriters have agreed to purchase on a bought deal basis an aggregate of 12,990,000 Subscription Receipts at an offering price of $24.25 per Subscription Receipt (the “Offering Price”) for total gross proceeds of $315 million (the "Offering"). Each Subscription Receipt will entitle the holder to receive one common share of Northland upon closing of the Acquisition. In connection with the Offering, Northland has granted the Underwriters an over-allotment option, exercisable in whole or in part, at any time for a period of 30 days following the closing of the Offering, to purchase up to an aggregate of an additional 1,299,000 Subscription Receipts at the Offering Price. The Offering is expected to close on September 18, 2019.

Further information regarding the Offering and the Acquisition, including related risk factors, will be set out in the Prospectus Supplement that Northland expects to file on SEDAR on or before September 11, 2019.

The Offering will be available in all provinces of Canada by way of a prospectus supplement to Northland’s base shelf prospectus dated May 24, 2018. Completion of the Offering is subject to certain conditions including receipt of all necessary approvals, including the approval of the Toronto Stock Exchange.

The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This news release does not constitute an offer to sell or the solicitation of any offer to buy, nor will there be any sale of these securities, in any province, state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such province, state or jurisdiction.

Analyst and Investor Teleconference Call

Northland will host a conference call to review the Acquisition today, September 9, 2019 at 4:15 p.m. ET. To listen to the call via audio webcast and view the Company's presentation, visit our website at and the link to the "Investor Center" section.

Conference call details:

Date: Monday September 9, 2019

Start Time: 4:15 p.m. ET

Webcast Link:   The call will also be broadcast live on the internet, in listen-only mode and may be accessed on

This event is being streamed. It is recommended that you listen via your computer speakers. Additional options for audio listening:

Phone Number:Toll free (North America):(866) 864-6943
 Toll free (International):(949) 877-3040
 Conference ID:1172539

For those unable to attend the live call, a replay of the webcast will be available on Northland’s website at

Please note: All amounts expressed herein are in Canadian Dollars, unless otherwise indicated. A one Canadian Dollar to the 2,540 exchange rate is used herein to establish equivalent amounts.


Northland Power is a global developer, owner and operator of sustainable infrastructure assets that deliver predictable cash flows. Headquartered in Toronto, Canada, Northland was founded in 1987 and has been publicly traded since 1997 on the Toronto Stock Exchange (TSX: NPI).

The Company owns or has an economic interest in 2,429 MW (net 2,014 MW) of operating generating capacity and 399 MW of generating capacity under construction, representing the Deutsche Bucht offshore wind project in the German North Sea and the La Lucha solar project in Mexico. Northland also owns a 60% equity stake in the 1,044 MW Hai Long projects under development in Taiwan.

Northland's common shares, Series 1, Series 2 and Series 3 preferred shares and Series C convertible debentures trade on the Toronto Stock Exchange under the symbols NPI, NPI.PR.A, NPI.PR.B, NPI.PR.C and NPI.DB.C, respectively.


This release contains certain forward-looking statements. Readers are cautioned that such statements may not be appropriate for other purposes. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.” These statements may include, without limitation, statements regarding Northland’s expectations or ability to complete the Acquisition in the fourth quarter of 2019, or at all, Northland’s ability to integrate EBSA if the Acquisition closes, Northland’s ability to participate across the energy infrastructure spectrum in Colombia, key members of EBSA continuing to lead EBSA in the future, the sources of proceeds to pay for EBSA, the future growth of EBSA’s regulated base rate, expected Adjusted EBITDA and the closing date of the Offering. These statements are based upon certain material factors or assumptions that were applied in developing the forward-looking statements. Although these forward-looking statements are based upon management’s current reasonable expectations and assumptions, they are subject to numerous risks and uncertainties. Some of the factors that could cause results or events to differ from current expectations include, but are not limited to, Northland’s ability to satisfy all closing conditions to the Acquisition and the Offering, Northland’s ability to integrate EBSA, construction risks, counterparty risks, operational risks, foreign exchange rates, regulatory risks, maritime risks for construction and operation, and the variability of revenues from generating facilities powered by intermittent renewable resources and the other factors described in the “Risks and Uncertainties” section of Northland’s 2018 Annual Report and Annual Information Form, both of which can be found at under Northland's profile and on Northland’s website, as well as the risks that will be set out under the heading “Risk Factors” in the Prospectus Supplement that Northland is expected to file on SEDAR. Northland’s actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur.

The forward-looking statements contained in this release are based on assumptions that were considered reasonable on date of release. Other than as specifically required by law, Northland undertakes no obligation to update any forward-looking statements to reflect events or circumstances after such date or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.


This press release includes references to Northland’s adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”) and free cash flow and applicable payout ratio and per share amounts, which are not measures prescribed by International Financial Reporting Standards (IFRS). Adjusted EBITDA and Free Cash Flow and applicable payout ratio and per share amounts do not have any standardized meaning under IFRS and, as presented, may not be comparable to similar measures presented by other companies. These measures should not be considered alternatives to net income, cash flow from operating activities or other measures of financial performance calculated in accordance with IFRS. Rather, these measures are provided to complement IFRS measures in the analysis of Northland’s results of operations from management’s perspective. Management believes that Adjusted EBITDA and Free Cash Flow and applicable payout ratio and per share amounts are widely accepted financial indicators used by investors to assess the performance of a company and its ability to generate cash through operations. Refer to the SECTION 1: OVERVIEW, SECTION 4.4: Adjusted EBITDA, SECTION 4.5: Free Cash Flow and SECTION 5: CHANGES IN FINANCIAL POSITION of the current Management’s Discussion and Analysis, which can be found on SEDAR at under Northland’s profile and on, for an explanation of these terms and for reconciliations to the nearest IFRS measure.

For further information, please contact:

Wassem Khalil, Senior Director, Investor Relations & Strategy
+1 (647) 288-1019