Western Wind management said it would receive proposals over the next two weeks from M&A firms and then, within ten days, choose the best offer.
The company said the plan was “…a compromise between the CEO’s plan of building the assets for another two years before contemplating a sale and the consistent suffering the company’s shareholders have endured by unregulated market participants trading the stock price down to levels that only serve to frustrate and shake out retail investors.”
The hornet’s nest of controversy surrounding Western Wind’s stock has been front and center since at least last autumn. On October 11th, the company announced it had received an unsolicited bid of $2.50 a share from Algonquin Power (TSX:AQN). Management wasted little time in dismissing the offer, warning investors that it was a lowball attempt and that “Algonquin is clearly not in a position to offer anywhere near a price that can internally utilize both the tax shield and offer Western Wind Energy shareholders the best value.”
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Western Wind management said it had conducted two independent valuations that valued its assets at $5.06 per share.
Takeover offers can often be emotional events, but the Algonquin-Western Wind saga contained a little more cloak and dagger than usual.
Just two weeks before the Algonquin offer, Western Wind notified the notified the Investment Industry Regulatory Organization of Canada that numerous shareholders had complained of “copious amounts of matched trades occurring on a daily basis, with the emphasis being on downward price trading after real-time market orders”. Western Wind management informed IIROC that it had “has been made aware in the past few days, that a certain party would like to make a takeover bid of certain or all of the assets of the company. The suggested offer price to the company is above the current market price…”.
The company informed shareholders “responsibility for down trading and match trading the share price to condition management or the public into accepting the takeover offer can easily be determined by the numerous tools and resources available to IIROC. Some of these market participants have different named entities but ultimately, have mind and control within the same premises.”
Western Wind Energy assets include more than five-hundred wind turbines and a solar field that generates 165 MW of rate capacity.
The flak continued right up until July 27th, when Western Wind filed its second claim in two months with the Supreme Court of British Columbia to identify users making what the company felt were defamatory posts on the Stockhouse message boards.
In an affidavit, Western Wind CEO Jeff Ciachurski said “t he posts both directly and indirectly imply … Western Wind is poorly managed, irresponsible, vindictive, and that I am dishonest, trying to steal the company, incompetent and intentionally manipulating the stock price. ”
At press time, shares of Western Wind Energy were up 42% to $1.69.