Algonquin Power & Utilities Corp. Completes Sale of Non-Regulated Renewable Energy Business to LS Power
Algonquin Power & Utilities Corp. (AQN), a diversified international generation, transmission, and distribution utility, announced today the successful completion of the sale of its non-regulated renewable energy business to LS Power, a leading infrastructure investment firm. The sale, which excludes the company’s hydroelectric fleet, represents a significant step in Algonquin’s ongoing transformation into a pure-play regulated utility.
A Pivotal Step in Algonquin’s Strategic Transformation
The decision to sell the non-regulated renewable energy business is part of Algonquin’s broader strategy to streamline its operations, simplify its portfolio, and focus on its core utility assets. Chris Huskilson, Chief Executive Officer of Algonquin Power & Utilities Corp., expressed his satisfaction with the successful completion of the sale, which marks an important milestone in the company’s transformation efforts.
“We are pleased with the timely and successful completion of the sale of our renewable energy business,” Huskilson stated. “This transaction, along with the recent sale of our 42.2% stake in Atlantica Sustainable Infrastructure plc on December 12, 2024, represents a pivotal step in transforming AQN into a pure-play regulated utility with reduced complexity. While there is still work to be done, passing this milestone will allow us to focus more on accelerating the pace of this transition and positioning AQN for long-term success.”
The sale is seen as a positive development for Algonquin, providing it with the opportunity to reduce the complexity of its operations and better align itself with its long-term strategic goals. By focusing more closely on regulated utility operations, AQN is positioning itself to better serve its customers while improving its financial strength and operational efficiency.
Use of Proceeds: Strengthening the Balance Sheet
As part of its strategy to streamline its operations and improve its financial standing, Algonquin plans to use the net proceeds from this transaction to pay down existing debt and strengthen its balance sheet. This will enhance the company’s financial flexibility and support its ongoing efforts to invest in regulated utility assets.
The sale of the non-regulated renewable energy business is a strategic move designed to bolster AQN’s ability to execute its future growth plans and continue delivering safe, reliable, and sustainable energy solutions to its customers. With a more focused and simplified business model, the company aims to better align its operations with the evolving energy landscape, ensuring it remains a key player in the regulated utility sector.
A Strong Advisor Team: J.P. Morgan and Legal Counsel
To ensure the transaction proceeded smoothly and achieved the best possible outcome, Algonquin enlisted the expertise of J.P. Morgan as the exclusive financial advisor. J.P. Morgan’s deep industry knowledge and experience played a crucial role in guiding AQN through the sale process and ensuring the company received optimal value for its non-regulated renewable energy business.
Additionally, two prestigious law firms—Gibson, Dunn & Crutcher LLP and Blake, Cassels & Graydon LLP—served as legal advisors to Algonquin, providing essential support in the legal and regulatory aspects of the transaction. Their guidance helped ensure that the sale complied with all relevant legal frameworks and was executed in a manner that served the best interests of the company and its stakeholders.
Algonquin Power & Utilities Corp. Overview
Algonquin Power & Utilities Corp. is the parent company of Liberty, a diversified international utility that provides a range of essential energy and water services. The company’s operations span multiple segments, including electricity generation, transmission, and distribution, as well as water utilities. With over one million customer connections primarily in the United States and Canada, AQN plays a vital role in delivering safe, reliable, cost-effective, and sustainable energy solutions.
AQN’s renewable energy portfolio has been a significant part of the company’s past growth. However, as part of its strategic shift towards regulated utility operations, the company is now focusing its efforts on regulated assets that provide more stable, predictable returns. This shift will allow AQN to better serve its customers while generating long-term value for shareholders.
The company is committed to advancing the transition to a low-carbon future, and its investments in renewable energy and sustainable water solutions reflect this commitment. While Algonquin will continue to have a significant presence in renewable energy through its hydroelectric fleet, the divestiture of its non-regulated renewable energy business represents a new chapter for the company as it becomes more focused on regulated utility operations.
The Future of Algonquin Power & Utilities Corp.
Looking ahead, Algonquin Power & Utilities Corp. is well-positioned to continue its growth trajectory within the regulated utility sector. The company’s commitment to providing sustainable energy solutions, combined with its improved financial position following the sale, ensures that it will remain a strong and reliable player in the industry.
AQN’s focus on regulated utilities will allow it to continue making essential investments in energy infrastructure, furthering its goal of providing reliable, low-cost energy to its customers. The company remains committed to pursuing a sustainable energy future, with ongoing investments in renewable energy generation, grid modernization, and water utilities.
With a stronger balance sheet and a more focused business model, Algonquin is poised to capitalize on opportunities in the regulated utility space, further enhancing its position as a leader in the energy and utilities sectors.
As the company transitions towards this new phase, it will continue to prioritize its core values: safety, reliability, sustainability, and customer satisfaction. The sale of its non-regulated renewable energy business is just one of many steps Algonquin is taking to enhance its operations, improve its financial health, and ensure long-term value for its shareholders and customers alike.
