TransAlta Ready to Part Ways With Transmission Assets
Highlighting TransAlta's increased attention to the generation side of its business, the company last Thursday said that it has signed an agreement to sell its Alberta-based transmission business to a consortium of companies collectively known as AltaLink.
"We have an excellent, well-run transmission business with a great team of employees, but we are focusing our future investments in our core growth strategy," said Steve Snyder, TransAlta's CEO. TransAlta's transmission business represents 10% of the company's assets and involves about 250 employees.
AltaLink is made up of SNC Lavalin Energy, Trans-Elect Inc., the Ontario Teachers' Pension Plan and Macquarie North America Ltd., a subsidiary of Macquarie Group of Sydney, Australia. SNC Lavalin holds the biggest ownership stake in the consortium at 50%. "This acquisition is a milestone occasion for SNC Lavalin since it is an important investment in Alberta, and capitalizes on our engineering and financing expertise," said Pierre Anctil, an executive vice president with SNC Lavalin.
Completion of the transaction, including regulatory approval, is expected by the first quarter of 2002. The transmission assets include some 12,000 kilometers of transmission lines and over 250 substations. Proceeds from the sale of TransAlta's transmission assets are expected to be approximately C$850 million and the anticipated gain from the sale is approximately C$100 million, or C$0.60 per share. TransAlta and AltaLink will file for approval of the transaction with the Alberta Energy Utility Board after consulting with intervenors.
TransAlta is Canada's largest non-regulated electric generation and marketing company, with more than $7 billion in assets and 8,000 MW of capacity.
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