CALGARY, Alberta, Nov 23 (Reuters) - Canadian renewable energy company TransAlta Renewables said on Monday it would invest C$540 million ($404 million) in three projects in Ontario and Quebec belonging to its majority-owner TransAlta Corp.
The assets are TransAlta’s Sarnia cogeneration plant and Ragged Chute hydro facility in Ontario, and the Le Nordais wind farm in Quebec. Together, they generate about 611 megawatts of power.
TransAlta Renewables’ investment will involve acquiring securities that track the profits of the three assets.
It has entered into a C$150 million bought deal offering to finance the cash portion of the investment and will sell C$200 million of TransAlta Renewables common shares to the Alberta Investment Management Corp.
It is the second time TransAlta Renewables has acquired assets from TransAlta Corp this year.
TransAlta Corp spun off its wind and hydroelectric power plants to form TransAlta Renewables in 2013 but still holds a majority stake in the company.
Both companies received a boost over the weekend from the Alberta government’s release of its long-term plan to tackle climate change and reduce the province’s greenhouse gas emissions.
TransAlta Renewables benefited as a renewable energy company, while TransAlta Corp said it was critically important that the government had committed to an orderly transition to phase out coal by 2030.
TransAlta Corp shares were last up 9.4 percent on the Toronto Stock Exchange at C$5.96, while TransAlta Renewables gained in early trade before dipping 0.2 percent to C$10.31.
$1 = 1.3357 Canadian dollars Reporting by Nia Williams; Editing by Peter Cooney