TransAlta Renewables Inc.
TSX : RNW

TransAlta Renewables Inc.

April 23, 2015 08:22 ET

TransAlta Renewables Inc. Announces Closing of Over-Allotment Option in Connection with Subscription Receipt Offering

CALGARY, ALBERTA--(Marketwired - April 23, 2015) - TransAlta Renewables Inc. ("TransAlta Renewables" or the "Company") (TSX:RNW) announced today that, in connection with its previously announced bought deal offering of subscription receipts ("Subscription Receipts") that closed on April 15, 2015, the syndicate of underwriters led by CIBC and RBC Capital Markets, as joint bookrunners, exercised the over-allotment option (the "Option") and purchased an additional 2,038,423 Subscription Receipts at the offering price of $12.65 per Subscription Receipt for gross proceeds of approximately $25.8 million.

The Subscription Receipt offering, including the Subscription Receipts issued pursuant to the exercise of the over-allotment option, has resulted in an aggregate of 17,858,423 Subscription Receipts being issued for gross proceeds to TransAlta Renewables of approximately $225.9 million ("the Offering").

The net proceeds will be used by TransAlta Renewables to finance a portion of the cash purchase price to acquire an economic interest based on the cash flows from TransAlta Corporation's Australian subsidiary TransAlta Energy (Australia) Pty Ltd ("TEA"), broadly equal to the underlying net distributable profits of TEA (the "Transaction"). TEA's portfolio of assets consists of 575 MW of power generation from six operating assets and the South Hedland project currently under construction, as well as the recently commissioned 270 km gas pipeline.

If the Transaction closes as anticipated, 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. 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 closing of the Transaction, unless a termination event occurs prior thereto or the Transaction does not close by July 31, 2015 (the "Termination Date"). If the closing of the Transaction does not occur on or before the Termination Date, or is terminated at an 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. Upon closing of the Transaction, TransAlta Corporation will own approximately 76% of the outstanding shares of TransAlta Renewables.

As TransAlta Corporation is an "insider" and "related party" to the Company, under applicable securities laws and stock exchange rules, the Transaction requires the approval of the shareholders of the Company (excluding TransAlta), which approval will be sought at a special meeting of the Company on May 7, 2015. 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, on May 7, 2015 at 10:00 a.m. (local time) in the Spectrum 3 Ballroom at Hotel Arts, located at 119 12 Avenue S.W., 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, and timing of the Transaction; the conversion of the Subscription Receipts into common shares of the Corporation 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 and the Offering, including risks associated with the receipt of required regulatory and shareholder approvals, economic and competitive conditions, changes in tax law and tax rate increases, exchange rates, interest rates, and other risk factors contained in the Company's annual information form. 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 29 wind and hydroelectric power generation facilities, including our economic interest in Wyoming Wind, having an aggregate installed generating capacity of 1,376 MW, in which it holds a net ownership interest of approximately 1,255 MW. 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 renewable power generation assets and expanding its asset base through the acquisition of additional renewable power generation facilities in operation or under construction. TransAlta Renewables objectives are to (i) create stable, consistent returns for investors through the ownership of contracted renewable power generation assets that provide stable cash flow through long-term power purchase agreements with creditworthy counterparties, including TransAlta; (ii) pursue and capitalize on strategic growth opportunities in the renewable power generation sector; and (iii) pay out a portion of cash available for distribution to the shareholders of TransAlta Renewables on a monthly basis.

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