TransAlta Renewables Inc. Announces Closing of Subscription Receipt Offering and Over-Allotment Option; Special Meeting to be held on January 6, 2016

Dec 2, 2015

CALGARY, Alberta (December 2, 2015) – TransAlta Renewables Inc. (“TransAlta Renewables” or the “Company”) (TSX: RNW) today announced the completion of its previously announced bought deal offering of subscription receipts (“Subscription Receipts”). The Company, through a syndicate of underwriters led by CIBC Capital Markets and TD Securities Inc., as joint bookrunners, issued a total of 17,692,750 Subscription Receipts at a price of $9.75 per Subscription Receipt for gross proceeds to TransAlta Renewables of approximately $172.5 million (the “Offering”), including 2,307,750 Subscription Receipts issued pursuant to the exercise by the underwriters of the over-allotment option in full.

The net proceeds will be used by TransAlta Renewables to finance a portion of its proposed $540 million investment (the “Transaction”) in TransAlta Corporation’s Sarnia Cogeneration Plant, Le Nordais wind farm and Ragged Chute hydro facility (the “Portfolio”). The Portfolio consists of approximately 611 MW of highly contracted power generation assets located in Ontario and Quebec. TransAlta Renewables’ investment will consist of the acquisition of securities which will track the net distributable profits of the Portfolio. As part of the Transaction, TransAlta Renewables will issue $152.5 million in common shares to TransAlta and $215 million in convertible unsecured subordinated debentures.

Upon closing of the Transaction, each holder of Subscription Receipts will automatically receive one Common Share for each Subscription Receipt held, without further action or additional consideration on the part of the holder. In addition, if the Transaction closes as anticipated, any dividends declared by the Company to holders of Common Shares with record dates from the date of closing of the Offering, up to, but not including, the date of closing of the Transaction, will be paid to such Subscription Receipt holders.

The net proceeds from the sale of Subscription Receipts will be held by an escrow agent and invested in short-term obligations of, or guaranteed by, the Government of Canada (and other approved investments) until the earlier of the closing of the Transaction and March 31, 2016 (the “Termination Date”). If the closing of the Transaction does not occur on or before the Termination Date, or is terminated at any earlier time, the Subscription Receipts will be terminated and cancelled, and the full subscription price of the Subscription Receipts will be returned to holders of Subscription Receipts, together with their pro-rata portion of any interest earned thereon.

As TransAlta Corporation is an “insider” and “related party” to the Company under applicable securities laws and stock exchange rules, the Transaction will require the approval of the shareholders of the Company (excluding TransAlta), which will be sought at a special meeting of the Company to be held on January 6, 2016. The Transaction is expected to close shortly after shareholder approval is received.

Special Meeting of Shareholders

The Company will hold a Special Meeting of Shareholders, which will take place on January 6, 2016 at 11:30 a.m (Calgary time) in the offices of Norton Rose Fulbright Canada LLP, located at 3700, 400 – 3rd Avenue SW, in Calgary, Alberta for the purpose of considering, and if deemed advisable, approving the Transaction.

This news release does not constitute an offer to sell or a solicitation of an offer to buy the Subscription Receipts in any jurisdiction.

Forward-Looking Statements

This news release contains forward looking statements within the meaning of applicable securities laws, including statements regarding the business and anticipated financial performance of TransAlta Renewables. All forward looking statements are based on the Company’s beliefs and assumptions based on information available at the time the assumptions were made, management’s experience and perception of historical trends, current conditions and expected future developments, and other factors deemed appropriate in the circumstances. These statements are not guarantees of the Company’s future performance and are subject to a number of risks and uncertainties that may cause actual results to differ materially from those contemplated by the forward looking statements. In particular, this news release contains forward looking statements pertaining to, among other things: the completion, size, and timing of the Transaction; the conversion of the Subscription Receipts into common shares of the Company; the timing of the Transaction; the conversion of Subscription Receipts into commons shares of the Company, and the ability to obtain the necessary regulatory and shareholder approvals for the Transaction. These forward-looking statements are subject to risks and uncertainties pertaining to the Transaction, including risks associated with the receipt of required regulatory and shareholder approvals, economic and competitive conditions. Furthermore, unless otherwise stated, the forward-looking statements contained in this news release are made as of the date of this news release, and the Company has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities regulations. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

About TransAlta Renewables Inc.

TransAlta Renewables owns 16 wind and 12 hydroelectric power generation facilities, and holds economic interests in TransAlta’s Wyoming Wind Farm and Australian Assets, having an aggregate installed generating capacity of 1,856 MW, in which it holds a net ownership interest of approximately 1,680 MW. TransAlta Renewables’ economic interest in Australian assets consist of 425 MW of power generation from six operating assets, which are operational and contracted under long-term contracts, and the 150 MW South Hedland project that is currently under construction, as well as the recently commissioned 270 km gas pipeline. TransAlta Renewables’ power generating capacity is among the largest of any publicly-traded renewable independent power producer (“IPP”) in Canada, with more wind power generating capacity than any other Canadian publicly-traded IPP. TransAlta Renewables’ strategy is focused on the efficient operation of its portfolio of assets and expanding its asset base through the acquisition of high-quality contracted renewable and natural gas power generation facilities and other infrastructure assets. Our objectives are to (i) create stable, consistent returns for investors through the ownership of contracted renewable and, potentially, natural gas power generation and other infrastructure assets that provide stable cash flow through long-term contracts with creditworthy counterparties, including TransAlta Corporation; (ii) pursue and capitalize on strategic growth opportunities in the renewable and, natural gas power generation and other infrastructure sectors; and (iii) pay out a portion of cash available for distribution to the shareholders of the Company on a monthly basis.

For more information:

Investor Inquiries:

Jaeson Jaman
Manager, Investor Relations
Phone: 1 800-387-3598 in Canada and U.S.

Media Inquiries:

Stacey Hatcher
Manager, Communications
Toll-free media number: 1-855-255-9184

LAST: CAD$14.280 (+1.301%)
2016-12-28 16:00:00

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