Under the agreement, Canadian Solar will acquire a majority interest in 16 solar projects representing approximately 190-200MW DC from SkyPower. Each of these projects was awarded a 20-year power purchase contract by the Ontario Power Authority. Fifteen of these contracts were issued under Ontario's Feed-In-Tariff Program, and one was issued as part of Ontario's Renewable Energy Standard Offer Program.
The projects are in the advanced permitting stage and are expected to commence construction in 2013 and be fully operational in 2014. They are expected to generate over C$800 million in revenue for Canadian Solar.
It is expected that the manufacturing and construction of the projects will create hundreds of new jobs in Ontario and continue to position Ontario as a North American leader in green energy.
Canadian Solar and SkyPower have also agreed to form a 50:50 international joint venture focused on developing solar power plants in select emerging markets. Canadian Solar expects to start generating revenue from the global strategic initiative within the next two to three years.
The transaction price is approximately C$185 million to be paid at certain milestones. Canadian Solar will assume certain security deposits, which are typical with FIT contracts. In conjunction with the transaction, a five-year warrant is being issued to SkyPower for 9.9 percent of Canadian Solar's outstanding shares, with a strike price of US$5.
Canadian Solar, SkyPower form international joint venture
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