Spark Power Group Inc (TSX:SPG)
Shares Issued 90,005,775
Last Close 11/30/2022 $0.55
Wednesday November 30 2022 - News Release
Mr. Richard Perri reports
SPARK POWER ANNOUNCES CLOSING OF THE SALE OF BULLFROG POWER TO ENVEST CORP.
Spark Power Group Inc., parent company of Spark Power Corp., has closed the previously announced sale of its Bullfrog Power Inc. business unit, including its United States business carried on through Bullfrog Solutions USA Inc., and its subsidiary companies, on Nov. 30, 2022. Bullfrog is being acquired by a wholly owned subsidiary of Envest Corp., for total all-cash proceeds of up to $35.0-million, subject to customary adjustments and including an earnout of up to $3.5-million, payable over a maximum of five years. Proceeds from the transaction will be used to reduce Spark Power's debt and finance working capital needs.
Bullfrog, founded in 2005, is Canada's trusted sustainability solutions provider, offering businesses and homeowners access to electricity from clean, renewable sources through renewable energy credits (RECs), power purchase agreements (PPAs) and energy efficiency services. Through its history, Bullfrog has helped customers displace over two million tonnes of CO2 (carbon dioxide) emissions and has serviced over 1,500 businesses and 10,000 homes. For the trailing 12 months ended Sept. 30, 2022, Bullfrog generated revenue representing approximately 5 per cent of Spark Power's total revenue over this period. Bullfrog was acquired by Spark Power in 2018.
Envest is a privately owned independent energy producer based in Toronto, Ont., and an arm's-length party to Spark Power.
"We believe that this transaction is an excellent strategic outcome for all parties involved, including for all of Bullfrog's great employees," said Richard Jackson, president and chief executive officer of Spark Power. "Notably, proceeds from the transaction will facilitate near-term deleveraging and strengthening of Spark Power's balance sheet, while also providing Spark Power with additional liquidity to support growth in the next stage of the company's maturity as we launch our new 2025 Let's Grow Better Strategy in the coming months. The transaction will also further streamline our business, allowing us to focus on our core technical services and renewables businesses. We look forward to continuing to partner with Bullfrog on future opportunities under its new ownership. We believe that Bullfrog is a very complementary business to Envest and anticipate that both Bullfrog and Envest will benefit as a result of this transaction."
Jason Moretto, president and chief executive officer of Envest, commented on the transaction: "We are excited to welcome Bullfrog into our operations. The transaction will provide significant immediate benefits to all parties involved, and allow Spark Power, Bullfrog and Envest to achieve new goals and realize growth opportunities. We thank the Spark Power leadership for an efficient and organized transactional process."
Spark Power and Envest will work closely together over the next 90 days to facilitate a seamless transition of the Bullfrog business, with a focus on ensuring continuity for both the customers and the employees of Bullfrog.
About Spark Power Group Inc.
Spark Power Solutions, a wholly owned subsidiary of Spark Power Group, is a leading independent provider of end-to-end electrical contracting, operations and maintenance services, and energy sustainability solutions to the industrial, commercial, utility and renewable asset markets in North America. It works to earn the right to be its customers' trusted partner in power. Spark Power's highly skilled and dedicated people, located in the communities it serves, combined with its knowledge of the power industry, technology expertise and commitment to safety, ensures the company delivers the right solutions that keep its customers' operations up and running today and better equipped for tomorrow.
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