NRG Yield Inc. has launched a public offering of 10.5 million shares of its Class A common stock. In addition, the underwriters have a 30-day option to purchase up to an additional 1.57 million shares of common stock from the company.
NRG Yield says it intends to use all of the net proceeds of the offering to acquire newly issued Class A units of NRG Yield LLC. Yield LLC intends to use the net proceeds of the offering, together with cash on hand and the proceeds from newly issued debt securities, to fund the previously announced $870 million purchase of the Alta Wind Energy Center (AWEC) in California from Terra-Gen Power.
In June, NRG Yield said the acquisition, which totals 947 MW of operating wind capacity, also includes a portfolio of land leases associated with the Alta wind facility. The AWEC is made up of several phases and features 386 GE and Vestas turbines, with commercial operations achieved within the past four years.
However, the common stock offering is not conditioned upon the completion of the AWEC acquisition, and Yield LLC may use the net proceeds from the offering for general corporate purposes, including funding other acquisition opportunities.
BofA Merrill Lynch, Citigroup, Morgan Stanley, Barclays and Goldman, Sachs & Co. are acting as joint bookrunners for the offering. Credit Suisse, Deutsche Bank Securities, KeyBanc Capital Markets, MUFG and RBC Capital Markets are acting as co-managers.