The company says the discussions are at an advanced stage and that initial offers are expected shortly.
In a terse message in Monday’s press release, CEO Jason Bak explained the reasoning behind Finavera’s decision to sell itself:
“Ever since the award of our electricity purchase agreements from BC Hydro in 2010, where we were the largest winner of wind power contracts in British Columbia’s history, we have focused on finding the optimal partner to unlock the value of the $2.5-billion in contracted payments to Finavera Wind Energy,” he said adding: “During this time we have dealt with adverse market conditions and short-term hedge funds that have punitively sold stock against the interest of the long-term shareholder. This has resulted in a significant difference between our market capitalization and our inherent value. We are optimistic that a corporate transaction will provide a solution where shareholders are part of a stronger platform to access the value of these assets and realize upside from the current company capitalization.”
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Finavera, which is headquartered in Vancouver, was actually founded in Dublin in 2003. The company is now decidedly Canadian in makeup, with three wind projects here compared to just one in Ireland, a 105 MW project on that country’s west coast. In February of last year, The company made a deal with GE Energy Financial Services that would see GE invest $40 million in the Wildmare project that Finavera planned to build near Chetwynd, BC. Then, in July, Finavera sold that property to Innergex Renewable Energy (TSX:INE) for $22-million.
The transaction shored up Finavera’s persistently shaky books. The company lost $3.24 million in 2011, sending its cash position to just $41,209 as of March 31st, 2012.
At press time, shares of Finavera Wind Energy were up 24% to $.36 cents.