Renowned power generator and retailor Mercury NZ Limited has recently announced that it has reached an agreement with the Tauranga Electricity Consumer Trust to acquire stake around 20% for USD 143 million in the wind power company Tilt Renewables.
In the recent announcement, Tilt added that the low wind conditions across Australia & NZ majorly experienced in the June 2017 quarter have incurred the company a total A$2.8 million loss for FY18.
For the record, the Auckland-based wind & solar firm Tilt Renewable has claimed the below average wind conditions in Australia and Zealand on top of the constraints put in place by AEMO in Australia, as the main drivers of the loss. Reports state that the Trust owns 26.8% of Tilt – which owns windfarms on both the sides of the Tasman. The deal however will leave the Trust with just under 7%, cite sources.
Tilt Renewables said that it is optimistic about the future growth potential of the regional renewable energy market, as renewable energy sources have cemented their position as the lowest-cost alternative for replacing Australia’s ageing thermal generation facilities. The company further stated that it is working on the design proposals, while the discussion has moved toward market structures & technology options that support large-scale deployment of renewable energy into the Australian electricity sector.
Fraser Whineray, chief executive, Mercury, was quoted stating that Tilt is an established business operating power plants in the thriving renewable energy industry, with a robust management team, good governance, and quality development pipeline. The company has developed a strong product portfolio of operating wind farms in NZ and Australia and is involved in renewable energy generation projects.
According to reports, the purchase price of the deal equates to USD 2.30 per share in cash, a significant high for Tilt’s latest closing stake price of USD 1.85.