NRG Yield Enters Into Deals With NRG On Next Drop Down, ROFO Pipeline Expansion

(RTTNews) - While reporting its fourth-quarter financial results today, NRG Yield, Inc. (NYLD, NYLD.A) said that on February 24, it entered into a definitive agreement to acquire the Agua Caliente and Utah utility-scale solar projects from NRG Energy Inc. (NRG) for cash consideration of $130 million, plus assumed non-recourse project debt of approximately $464 million, excluding adjustments for working capital.

However, NRG Yield has elected not to pursue the acquisition of the Minnesota, Community, and Jeffers wind projects at this time, but may continue its evaluation of the projects.

NRG Yield has retained the right with NRG, pursuant to the Right of First Offer or ROFO Agreement, to participate in any process to the extent NRG elected to pursue a third party sale of these assets.

In connection with the execution of the definitive agreement, NRG Yield and NRG entered into an amendment to the ROFO Agreement to expand the NRG ROFO pipeline with the addition of 234 net MW of utility-scale solar projects that NRG acquired as part of the SunEdison transaction.

The company will fund the purchase price for the drop down transaction entirely with cash on hand and it is expected to increase Cash Available For Distribution or CAFD on an annual basis by approximately $13.3 million.

The transaction is expected to close within the next 60 days and NRG Yield expects to record its interests in the acquired projects as equity method investments.