OTTAWA (dpa-AFX) - Drax Group Plc (DRX.L), an electricity generation company, Monday said it has signed an agreement to buy Pinnacle Renewable Energy Inc. (PL.TO), a Canadian producer and supplier of sustainable biomass.
Drax's unit Drax Canadian Holdings Inc. will acquire Pinnacle at a price of C$11.30 per share. The per share price represents a premium of 13% based on the closing market price as of February 5.
The deal values the fully diluted equity of Pinnacle at C$385 million or about 226 million pounds, with an implied enterprise value of C$741 million, including C$356 million of net debt.
The acquisition will be implemented by way of a statutory plan of arrangement in accordance with the laws of the Province of British Columbia, Canada.
The acquisition remains subject to Drax and Pinnacle shareholder approval, court approval, regulatory approvals and the satisfaction of certain other customary conditions.
The deal has been unanimously recommended by the board of Pinnacle and has the full support of Pinnacle's major shareholder, affiliates of ONCAP, which, together hold shares representing approximately 31% of Pinnacle.
Completion of the deal is expected to occur in the second or third quarter of 2021.
Copyright RTT News/dpa-AFX