Hydro utility acquires wind developer Vector Wind Energy

Eyeing expansion in Manitoba and Ontario, Calgary's Canadian Hydro Developers has agreed to pay about C$6.3 million for Vector Wind Energy Inc of Ottawa. Canadian Hydro, a veteran wind project developer with just over 118 MW of wind capacity operating in Alberta and Ontario and power purchase agreements in place for another 330 MW, has struck a deal to pay C$0.30 for each Vector share, representing a 50% premium over the volume-weighted average price of Vector shares on the TSX Venture Exchange for the 20 trading days ending October 11. The acquisition will need the approval of two-thirds of the votes cast by Vector shareholders and warrant holders at a special meeting this month. Vector's board of directors has unanimously approved the deal. "This will allow Vector shareholders to monetize the value which has been created from Vector's extensive wind exploration efforts over the past few years," says president Brian Barr. The acquisition, says Canadian Hydro, will "strategically position" the company for opportunities in Manitoba where the province's monopoly utility plans to add 1000 MW of wind to its system over ten years, starting with a 300 MW request for proposals this winter. Vector, which has no wind projects in the ground, is actively developing eight projects in the province. The purchase also gives Canadian Hydro additional development opportunities in Ontario where some of Vector's projects are expected to qualify under the province's new standard offer contract program for wind facilities of no more than 10 MW rated capacity. On the TSX Venture Exchange, Vector Energy shares jumped C$0.11, or about 65%, to C$0.28 after the deal was announced. On the Toronto stock market, Canadian Hydro shares rose C$0.08 to C$5.59.