Canadian Solar Inc. and SkyPower Ltd. have entered into a purchase and international joint venture agreement. The transaction price is approximately C$185 million, to be paid at certain milestones.
Under the agreement, Canadian Solar will acquire a majority interest in 16 solar projects representing approximately 190 MW to 200 MW from SkyPower. Each of these projects was awarded a 20-year power purchase contract by the Ontario Power Authority. Fifteen of these contracts were issued under Ontario's feed-in-tariff program, and one was issued as part of Ontario's Renewable Energy Standard Offer Program. These projects are in the advanced permitting stage and are expected to commence construction in 2013 and be fully operational in 2014. They are expected to generate over C$800 million in revenue for Canadian Solar.
Canadian Solar and SkyPower have also agreed to form a 50/50 international joint venture focused on developing solar power plants in select emerging markets. The company expects to start generating revenue from this global strategic initiative within the next two to three years.
‘This transaction solidifies our Ontario pipeline well into 2014 and supports our stated goal of achieving 40 percent of revenue from providing solar power plants and total system solutions in 2013,’ notes Shawn Qu, chairman and CEO of Canadian Solar.