Innergex's Strategic Financings: Strengthening Balance Sheet and Fueling Growth

Innergex Renewable Energy Inc. (TSX: INE) has recently closed two significant non-recourse financing agreements totaling $199.0 million for the Ashlu Creek hydro facility and the Mesgi'g Ugju's'n wind farm. These financings not only optimize the company's financial structure but also support its disciplined, self-funded growth strategy. Let's delve into the details and explore how these agreements contribute to Innergex's long-term success.

The first financing is a $133.7 million non-recourse project financing with The Canada Life Assurance Company for the 50 MW Ashlu Creek hydro facility. This facility, located in British Columbia, has been in operation since 2009 and benefits from a 30-year power purchase agreement (PPA) with BC Hydro. The proceeds from this financing will be used to repay the existing debt on the Ashlu Creek facility, reducing Innergex's interest expenses and enhancing its cash flow profile.

The second financing is a $65.3 million non-recourse back leverage financing with National Bank of Canada and SLC Management for the 150 MW Mesgi'g Ugju's'n wind farm in Quebec. This wind farm, operational since 2016, has a 20-year fixed-price PPA with Hydro-Québec. The funds from this financing will be used to reduce the corporate revolving credit facility, effectively lowering Innergex's corporate leverage.

By leveraging these existing assets, Innergex strengthens its balance sheet, enhances liquidity, and maintains flexibility for future development activities. The long-term benefits for stakeholders include strategic optimization of renewable energy assets, improved financial structure, and the potential for increased cash flows and shareholder value.

Innergex's long-term PPAs for both facilities ensure financial stability and predictability. The 30-year PPA for Ashlu Creek and the 20-year PPA for Mesgi'g Ugju's'n provide steady revenue streams, mitigating risks and supporting Innergex's disciplined, self-funded growth strategy.

In conclusion, Innergex's recent $199.0 million non-recourse financings for the Ashlu Creek hydro facility and the Mesgi'g Ugju's'n wind farm align perfectly with its disciplined, self-funded growth strategy. These financings allow Innergex to repay existing debt, reduce corporate leverage, and support future growth opportunities. By optimizing its renewable energy asset portfolio and reducing corporate leverage, Innergex continues to create long-term value for its stakeholders.