TSX.V Symbol: "WND"
OTCQX Symbol: "WNDEF"
Issued and Outstanding: 70,462,806
VANCOUVER, Feb. 4, 2013 /CNW/ - Western Wind Energy Corp. - (the "Company" or "Western Wind") (TSX Venture Exchange - "WND")
(OTCQX - "WNDEF") provides an update and responds to an amendment to
the unsolicited offer (as amended, the "Offer") by WWE Equity Holdings
Inc, an indirect subsidiary of Brookfield Renewable Energy Partners
L.P. (together, "Brookfield") to acquire all of the issued and
outstanding common shares (the "Shares" or the "Western Wind Shares")
of Western Wind.
Option on New 100 MW Power Purchase Agreement
Western Wind is pleased to announce that the Company has entered into an
option agreement (the "Option Agreement") with PBJL Energy Corporation
("PBJL") for the sole and exclusive right and option (the "Option") to
purchase rights held by PBJL under a Master Renewable Power Purchase
and Operating Agreement (the "Master PPA") between PBJL and Puerto Rico
Electric Power Authority (the "Power Authority"). Pursuant to the
Master PPA, PBJL has the right to sell power from one or more solar
energy facilities with a net aggregate capacity of up to 100MWs in
various locations in Puerto Rico (the "Project Rights") and the Power
Authority has agreed to purchase all electricity produced from the
locations in connection with the Project Rights. The power purchase
agreements entered into under the Master PPA will have a tenure of 20
years and the projects must be online by December 31, 2015.
Pursuant to the Option Agreement, the Company has the exclusive right to
acquire the Project Rights and all rights currently held by PBJL under
the Master PPA upon making a payment of US$5,000,000. The Option may
be exercised either by acquiring the shares of PBJL or the Project
Rights including an assignment of the Master PPA. The Option will
terminate upon the earlier of (i) September 30, 2013, if the closing of
the Option has not occurred on or before that date; (ii) immediately
at the sole discretion of PBJL, upon a "change of control" (as defined
in the Option Agreement) of Western Wind which includes a transaction
which is not supported by the Board of Directors or a material change
in the composition of the Board of Directors of the Company. Unless the
Offer is supported by the Board of Directors, the taking up of shares
by Brookfield under the Offer will permit PBJL to terminate the Option.
The Company was able to acquire the Option for nominal consideration.
PBJL is a private company principally owned by independent businessmen
who from time to time provide consulting services to the Company. The
US$5 Million payment will be paid by and at the sole discretion of the
Board approved purchaser of Western Wind.
The Company's ability to exercise the 100MW option will be subject to
the receipt of all required approvals. The Master PPA can be used on
sites acquired or developed by third parties and, subject to meeting
all stated conditions, the Power Authority is obligated to purchase the
energy generated up to 100 MW. There is no obligation by PBJL to
produce or build any facility.
Response to Amended Offer
On January 28, 2013, Brookfield announced that it had amended and
supplemented the Offer in order to (a) increase the price payable under
the Offer to $2.60 in cash for each Western Wind Share and (b) extend
the expiry of the Offer from 5:00 p.m. (Toronto time) on January 28,
2013 to 5:00 p.m. (Toronto time) on February 11, 2013 (a statutory
holiday in British Columbia), unless the Offer is further extended or
withdrawn (the "Amended Offer").
After careful consideration, including a thorough review of the Amended
Offer, as well as other factors, on February 3, 2013, the Special
Committee and the Board of Directors both determined that they
recommend that shareholders REJECT the Amended Offer.
While the auction process remains open, no binding offer has been made
as of the date of this news release. Brookfield acquired its interest
in the Company after the announcement of the sale process. The Board of
Directors is of the view that this was done to influence the sale
process. To date, the presence of the Offer in addition to Brookfield's
position as a significant shareholder of the Company has had a chilling
effect on the sale process.
The Special Committee and the Board of Directors continue to believe
that the sale of the Company should proceed by way of an auction
process unencumbered by the Offer. Management and the Board of
Directors of the Company remain committed to a sale of the Company and
delivering the superior value to its shareholders.
The Project Rights and the Master PPA may represent an important asset
of the Company and provide an opportunity to increase value during the
sales process. The Offer, as it was made before the entering into of
the Option Agreement, does not ascribe any value to the Project Rights
or the Master PPA. The Board of Directors is of the view that the
acquisition of an option on the Project Rights and the Master PPA is an
example of current management's belief that it can deliver greater
value to shareholders than represented by the Offer, and that a Board
supported purchaser will have a substantial opportunity to own
additional contracted PPA rights. The Option to acquire the Master PPA,
if exercised by a board supported purchaser of Western Wind, will
provide that purchaser access to a total of 295 MW of contracted PPA's
rather than the current 195MW. This is an increase of 51% of total MW
under contract that could be acquired by a Board supported purchaser.
Shareholders are urged to consider the Amended Offer carefully, and to
read the Notice of Change which will be filed by the Company shortly in
its entirety before deciding whether to accept or reject the Amended
Offer. Any shareholder who is in doubt as to how to respond to the
Amended Offer, including whether or not to tender or to withdraw his or
her Shares, should consult his or her own investment dealer, tax
advisor, lawyer or other professional advisor.
In the Notice of Change to the Supplementary Directors' Circular issued
by the Board of Directors on January 23, 2013, the Company provided
information on certain discussions between the Company and Brookfield
and an indication from Brookfield that an improvement to the Offer may
have been possible. On January 24, 2013, Brookfield announced that it
had terminated discussions regarding any alternative transactions to
The Company continues to pursue its application with the Ontario
Securities Commission for an order requiring Brookfield to prepare and
disclose the results of a formal valuation in compliance with
Multilateral Instrument 61-101 - Protection of Minority Security
Holders in Special Transactions ("MI 61-101") as part of the Offer.
On January 28, 2013, Brookfield also announced that shareholders holding
9,031,300 Western Wind Shares, or 15.27% of the Shares held by
shareholders independent of Brookfield ("Independent Shareholders"),
have entered into lock-up agreements with Brookfield (the "Lock-Ups").
The Lock-Ups will terminate if another offer is made for consideration
of 5% more than the price under the Offer. Brookfield also announced
that it has been advised that an additional 3,971,713 Western Wind
Shares, representing approximately 6.7% of the Shares held by
Independent Shareholders, will also potentially be tendered to the
Offer (the "Intentions to Tender"). Therefore, Brookfield has stated
that based on the number of Western Wind Shares that are subject to the
Lock-Ups and the Intentions to Tender, shareholders holding 13,003,013
Western Wind Shares, representing approximately 21.97% of the Shares
held by Independent Shareholders, have indicated that they will tender
to the Offer. The Company wishes to note that, according to
Brookfield's public statements, the Western Wind Shares that are
subject to the Lock-Ups and the Intentions to Tender have not actually
been tendered to the Offer. It is impossible to tell how many Western
Wind Shares have been actually tendered to the Offer.
Given public statements made by Brookfield regarding the number of
Western Wind Shares that are subject to the Lock-Ups and the Intentions
to Tender, the Company wishes to note the following regarding the
minimum tender condition relating to the Offer as well as Brookfield's
ability to acquire Western Wind Shares not deposited to the Offer:
It is a condition of the Offer that half of the Western Wind Shares held
by Independent Shareholders are tendered to the Offer (the "Minimum
If, within four months after the date of the Offer, the Offer has been
accepted by shareholders who, in the aggregate, hold at least 90% of
the Western Wind Shares (other than Western Wind Shares held by
Brookfield as of the date of the Offer), Brookfield has stated that it
intends, subject to compliance with applicable laws, to acquire (the
"Compulsory Acquisition") all the remaining Western Wind Shares on the
same terms that the Western Wind Shares were acquired pursuant to the
Offer, pursuant to the provisions of applicable corporate law. Western
Wind Shares held by Brookfield as of the date of the Offer will not be
counted towards the 90% threshold for a Compulsory Acquisition.
If Brookfield acquires less than 90% of the Western Wind Shares,
Brookfield may pursue other means of acquiring the remaining Western
Wind Shares not deposited under the Offer (a "Subsequent Acquisition
Transaction"). In order to complete a Subsequent Acquisition
Transaction, Brookfield must, after taking up Western Wind Shares under
the Offer, own at least 66 ⅔% of the outstanding Western Wind Shares on
a fully-diluted basis and sufficient votes must be cast by "minority"
holders to constitute a majority of the "minority" pursuant to MI
61-101. Brookfield has stated that it intends to cause the Western Wind
Shares acquired under the Offer to be voted in favour of such a
Subsequent Acquisition Transaction and, to the extent permitted by
applicable laws, to be counted as part of any minority approval that
may be required in connection with such transaction. However, Western
Wind Shares held by Brookfield as of the date of the Offer will not be
counted as part of any such minority approval.
Jeff Ciachurski, CEO of Western Wind states "We are proud to have all of our relationships work together to add
significant value for the benefit of our shareholders during the sales
process. An executed 100 MW solar PPA is a significant asset especially
given 74% of Puerto Rico's electrical generation is derived from
burning dirty and volatile priced oil. This fact allows strong PPA
pricing for us but yet affords the Power Authority with a cheaper and
cleaner pricing option for the rate payers of Puerto Rico. We expect
any purchaser of Western Wind to consider this a major benefit in their
ABOUT WESTERN WIND ENERGY CORP.
Western Wind is a vertically integrated renewable energy production
company that owns and operates wind and solar generation facilities
with 165 net MW of rated capacity in production, in the States of
California and Arizona. Western Wind further owns substantial
development assets for both solar and wind energy in the U.S. The
Company is headquartered in Vancouver, BC and has branch offices in
Scottsdale, Arizona and Tehachapi, California. Western Wind trades on
the TSX Venture Exchange under the symbol "WND", and in the United
States on the OTCQX under the symbol "WNDEF".
The Company owns and operates three wind energy generation facilities in
California, and one fully integrated combined wind and solar energy
generation facility in Arizona. The three operating wind generation
facilities in California are comprised of the 120MW Windstar, the 4.5MW
Windridge facilities in Tehachapi, and the 30MW Mesa wind generation
facility near Palm Springs. The facility in Arizona is the Company's
10.5MW Kingman integrated solar and wind facility. The Company is
further developing wind and solar energy projects in California,
Arizona, and Puerto Rico.
ON BEHALF OF THE BOARD OF DIRECTORS
Jeffrey J. Ciachurski
President & Chief Executive Officer
Neither the TSX Venture Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
Certain statements contained in this news release may constitute
forward-looking information under applicable Canadian securities
legislation. These statements relate to future events and are
prospective in nature. All statements other than statements of
historical fact may constitute forward-looking statements or contain
forward-looking information. Forward-looking statements are often, but
not always, identified by the use of words such as "may", "will",
"project", "predict", "potential", "plan", "continue", "estimate",
"expect", "targeting", "intend", "could", "might", "seek",
"anticipate", "should", "believe" or variations thereof.
Forward-looking information may relate to management's future outlook
and anticipated events or results and may include statements or
information regarding the future plans or prospects of the Company.
Forward-looking information is based on certain factors and assumptions
regarding, among other things, the exercise of the Option and value
that might be derived from the Master PPA, the outcome of a hearing
before the OSC, if such hearing occurs, the results of a valuation, if
obtained by Brookfield, and the availability of a financially superior
offer. Several factors could cause actual results to differ materially
from those expressed in the forward-looking statements, including, but
not limited to: the ability to exercise the Option and realize value
from the Master PPA, the outcome of a hearing before the OSC, if such
hearing occurs, the results of a valuation, if obtained by Brookfield,
may not be as anticipated by the Company, actions taken by Brookfield,
actions taken by the Western Wind Shareholders in relation to the
Offer, the possible effect of the Offer on the Company's business, the
outcome of the Company's previously-announced sale process, and the
availability of value-maximizing alternatives relative to the Offer.
Additional risks and uncertainties can be found in the Company's MD&A
for the year ended December 31, 2011 and the Company's other continuous
disclosure filings which are available at www.sedar.com.
Forward-looking statements and forward-looking information involve known
and unknown risks, uncertainties and other factors that may cause
actual results or events to differ materially from those anticipated.
Forward-looking information is subject to a variety of known and
unknown risks, uncertainties and other factors that could cause actual
events or results to differ from those reflected in the forward-looking
statements including, without limitation: the risk that the Company
will not be able to exercise the Option or obtain any value from the
Master PPA, the risk that the outcome of a hearing before the OSC will
not be in the Company's favor, the results of the valuation, if
obtained by Brookfield, will not be as anticipated by the Company, the
progress of Western Wind's sales process, and, assuming the Company
receives an expression of interest from a prospective purchaser,
whether a financially superior offer for Western Wind emerges, whether
the Company is able to successfully negotiate a prospective sales
transaction and whether the conditions of any proposed transaction,
including receipt by the Company of all necessary approvals, are met.
The Company believes that the expectations reflected in the
forward-looking statements contained in this news release are
reasonable, but no assurance can be given that they will prove to be
correct. Actual results and future events may differ materially from
those anticipated and accordingly forward-looking statements should not
be unduly relied upon. Forward-looking statements contained in this
document speak only as of the date of this news release. Except as
required by applicable law, Western Wind disclaims any obligation to
update any forward-looking information.
SOURCE: Western Wind Energy