KKR to buy Emera’s equity interest in Labrador Island Link for CAD$1.19B

Emera and KKR announced they have entered into a definitive agreement where KKR will acquire Emera’s indirect minority equity interest in the Labrador Island Link LIL . The transaction value is $1.19B CAD, made up of $957M CAD in cash and $235 million CAD for assuming Emera’s obligation to fund the remaining initial capital investment. “We’re pleased to be part of the future success of the Labrador Island Link.” As part of its overall commitment to the Lower Churchill Project, Emera has been an equity investor in the construction of the LIL alongside Newfoundland and Labrador Hydro which owns and operates the LIL. The transaction announced provides for a one-time, up-front payment at closing in exchange for Emera’s indirect interest in the LIL, meaning KKR will receive quarterly distribution payments over the remaining life of the 50-year LIL contract and allow Emera to reduce corporate debt and fund its investments in its regulated utility businesses. Emera will remain actively engaged in the LIL partnership, along with NL Hydro, by continuing to provide sustaining capital investments to support ongoing operations. This transaction has no impact on Emera’s ownership of the Maritime Link transmission line and no impact on Nova Scotia Power, or its customers… The transaction is expected to close on or about June 4.