Leaf Clean Energy Company has given an update regarding the Company’s investment in Invenergy Wind LLC. As previously announced the Company and Invenergy have a disagreement on certain contractual provisions contained in the operating agreement of Invenergy which can have a significant impact on the value of Leaf’s investment in Invenergy and consequently on the quantum of future returns to Leaf’s shareholders. The following steps have been taken to resolve the disagreement.
- On 21 December 2015 Leaf filed a complaint against Invenergy seeking payment to Leaf of $126.0 million.
- On 28 December 2015 Invenergy initiated a process to purchase Leaf’s interest in Invenergy through a call, and Leaf also put the interest to Invenergy. Two third-party appraisers were retained by each of the Company and Invenergy to assess the value of the investment.
The Company has now received the appraisers’ assessments of valuation which are US$73.1 million and US$36.4 million. As the assessments are greater than 20% apart, a third appraiser will be jointly appointed and the average of the three appraisals will be used to determine the put/call price.
The put/call process and the $126 million complaint are not mutually exclusive. The complaint is still in progress and there are no material updates at this stage.
The Company’s Interim Report noted a Net Asset Value as at 31st December 2015 of US$109 million being 92.28 cents per share. Included within net assets was the Company’s investment in Invenergy (“the Invenergy investment”), held at a value of US$101 million The Invenergy investment is currently held at US$97.1 million, as a result of the recent US$3.9 million capital return. For illustrative purposes, if the average of the two existing appraisals was used to determine NAV as at 31st December 2015 then the resultant NAV for Leaf as at this date would have been US$62.8 million or 50.74 cents per share (34.71 pence per share at today’s exchange rate).
The Board says it cannot predict the outcome or the timing of either the put call process or the complaint. The Board will provide further updates in due course.
LEAF : Leaf Clean Energy updates on Invenergy Wind