ReVolve Renewable Power Corp (TSX-V:REVV) said it has signed a definitive agreement to acquire 100% of Mexico’s Centrica Business Solutions Mexico S.A. de C.V. (CBS Mexico), a subsidiary of Centrica PLC (LSE:CNA), for a total consideration of $33 million Mexican pesos. The renewable energy projects owner and developer said the deal adds a 2.8 megawatt (MW) portfolio of operational distributed generation assets in Mexico and a further 3MW asset that is under construction and expected to go into operation by the end of 2022. “We are extremely excited about the opportunity presented by the acquisition,” ReVolve Renewable Power CEO Steve Dalton said in a statement. READ: ReVolve Renewable Power completes right-of-way approval process in ‘major milestone’ for Bouse solar and storage project “It will fast track the company's strategy for the distributed generation market while moving the business from being a pure development company to an independent power producer generating electricity, revenues and cash flow,” Dalton added. ReVolve noted the energy generated by these projects is sold under a number of fixed-price power purchase agreements with industrial clients located in central Mexico with an average remaining term of about eight years. It added that the operational projects are expected to generate revenues and earnings before interest, taxes, depreciation and amortization (EBITDA) in excess of the equivalent of US$400,000 and US$300,000, respectively, per year. As well, the company said the cash consideration of the transaction is to be funded through a combination of cash on hand and a new C$1.6 million, two-year secured loan facility being provided by RE Royalties. ReVolve also noted it has entered into a royalty agreement with RE Royalties, under which RE will receive a variable royalty of between 1% to 5% on gross revenues generated by a number of the operational projects for the life of the power purchase agreements for each relevant operational project. The company and RE Royalties expect to collaborate on further distribution generation projects as the company looks to continue to aggressively grow this part of its business, ReVolve said. The acquisition is expected to close within the next 45 days and conditional approval has been received from the TSX Venture Exchange, according to the company. ReVolve Renewable Power is in the business of developing utility-scale renewable energy generation projects in North America with a particular focus on wind, solar and battery storage technologies. Contact Sean at email@example.com
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