Partnership of a different kind

The acquisition of the SM-1 hydroelectric facility with the Desjardins Group Pension Plan.

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SM-1 hydroelectric facility near Sept-Îles, Quebec.

In June 2014, Innergex and the Desjardins Group Pension Plan created a 50-50 partnership in order to acquire the 30.5 MW SM-1 hydroelectric facility in Quebec, Canada.

In so doing, Innergex has found a partner that shares a very long-term investment horizon and enjoys a low cost of capital. In addition, it is growing its portfolio of quality assets, while optimizing the return provided by the acquisition and increasing its Free Cash Flow.

The financial structure of this partnership is innovative: “We are very pleased to have developed a transaction structure that allows us to compete in acquiring renewable energy infrastructure assets at prevailing market prices, while leveraging the low capital cost and long-term horizon of a pension fund as well as our expertise as an operator, to achieve an attractive after-tax internal rate of return for our shareholders. We intend to replicate this structure for future acquisitions of renewable energy assets,” states Michel Letellier, President and Chief Executive Officer of Innergex.