Brookfield Renewable submits proposal to acquire outstanding Class A common shares of TerraForm Power

Brookfield Renewable Partners L.P., the renewable power arm of Brookfield Asset Management Inc, has made a non-binding, all-share proposal to acquire the outstanding Class A common shares of TerraForm Power, Inc.,  other than the 62% owned by Brookfield Renewable and its affiliates. 

Pursuant to the proposed transaction, each Class A common share of TerraForm Power would be acquired, on a tax-deferred basis, for consideration equivalent to 0.36 of a Brookfield Renewable unit. Consideration for the transaction will be in the form of Class A shares of Brookfield Renewable Corporation (BEPC shares).

The proposal values TerraForm Power at US$17.31, representing an 11% premium to the closing share price of TerraForm Power on January 10, 2020.

Brookfield Renewable intends to make a special distribution of BEPC shares to its unitholders. The BEPC shares will be structured with the intention of providing an economic return equivalent to Brookfield Renewable units, including identical distributions, and will be exchangeable, at the shareholder's option, for Brookfield Renewable units on a one-for-one basis. As such, the proposed transaction would allow TerraForm Power shareholders to acquire economic exposure to Brookfield Renewable through shares of a corporation. The exchange ratio will be adjusted on a proportional basis to reflect the contemplated special distribution of BEPC shares to Brookfield Renewable unitholders, which we expect to close concurrently with the closing of the proposed transaction.

The proposed transaction is subject to the negotiation and execution of definitive transaction documents and customary approvals, including approval of a committee of the Board of Directors of TerraForm Power consisting solely of independent directors, and the approval of a majority of TerraForm Power’s stockholders not affiliated with Brookfield Renewable. Brookfield Renewable will not pursue the proposed transaction without obtaining these approvals.