Canada's Enbridge buys U.S. green power firm Tri Global (updated)
29/09/2022 20:10
(Adds comment from Enbridge executive, analyst comment)
By Nia Williams and Ruhi Soni
Sept 29 (Reuters) -
Canadian energy infrastructure firm Enbridge Inc ENB.TO on
Thursday said it has acquired U.S.-based renewable energy
developer Tri Global Energy (TGE) for $270 million and assumed
its debt.
Dallas-based TGE is the third-largest onshore wind developer
in the United States, and has monetized more than 6 gigawatts
(GW) of utility scale solar and wind projects since its
inception in 2009.
Calgary-based Enbridge said TGE's debt amount to $17
million and it could make up to about $50 million in additional
payments as TGE completes certain projects.
The all-cash deal strengthens Enbridge's renewables
portfolio, with also includes offshore wind farms in Europe and
solar projects supplying power to its oil and gas pipelines in
North America.
Enbridge is best known for its network of pipelines that
ship the bulk of Canadian crude to the United States, but the
company said it is focused on growing its renewables portfolio,
which currently makes up about 5% of the company.
"We really liked this acquisition because it accelerates
the growth ambition we have in our company for renewable power
and new energy generally, and low carbon infrastructure,"
Matthew Akman, Enbridge's senior vice president of strategy,
power and new energy technologies, told Reuters in an interview.
The TGE deal means Enbridge does not need to make any
further acquisitions in the onshore wind sector, he added.
"If you look at the amount of potential investment just
in the development assets of the company that we're acquiring
here, it's billions of dollars."
The U.S. government recently announced substantial
renewable energy tax credits through its Inflation Reduction Act
(IRA). Akman said the investment fundamentals for U.S. renewable
power projects were improving even before the IRA thanks to an
"incredible escalation" in demand for clean electricity from
corporations.
The deal comes a day after Enbridge said it will sell a
C$1.12 billion ($816.51 million) minority stake in seven Alberta
oil pipelines to a group of Indigenous communities. urn:newsml:reuters.com:*:nL4N30Z3D0
BMO Capital Markets analyst Ben Pham said Enbridge was
likely recycling capital from recent asset sales to fund the TGE
acquisition.
Enbridge shares were last down 1.9% at C$51.45 on the
Toronto Stock Exchange.
($1 = 1.3717 Canadian dollars)
(Reporting by Ruhi Soni in Bengaluru; Editing by Maju Samuel
and David Gregorio)
((Ruhi.Soni@thomsonreuters.com
Twitter: https://twitter.com/ruhithere))