In a definitive agreement, Capstone Infrastructure Corporation and Renewable Energy Developers Inc. agreed to do a share exchange. According to the terms of the agreement, all outstanding shares of Renewable Energy Developers, operating wind power facilities, would be acquired by Capstone. The transaction was valued at Can$70 million and was agreed upon by the BODs of both companies.
For every common share, Renewable Energy Developers would get 0.26 common share of Capstone plus Can$0.001 cash. This payment represented a 10.8% premium on the two companies' common shares of 0.91 and 3.88 as of July 2, 2013, respectively. Stockholders of the two companies would own about 80% and 20% of combined common shares.
The share exchange agreement would result in not only a well-funded company but also one that is larger and more diversified, with a total net of 465 MW power generation facilities. After the transaction, which brought together two high complementary entities, Capstone would also find it easier to go into renewable power development, with contracted development opportunities of amounting to 79 MW.
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