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NZ Windfarms is spending $20.1 million to buy its troubled Australian investment partner, Babcock & Brown out of the Te Rere Hau Wind Farm project near Palmerston North.
A NZ Windfarm subsidiary NZWL-TRH has agreed to pay NPBB, a company owned by Babcock & Brown and NP Power, for a 50 per cent interest in the joint venture.
The purchase would come from cash reserves, said NZ Windfarms chairman Derek Walker.
"The acquisition will enable NZ Windfarms to access 100 per cent of the Te Rere Hau Wind Farm revenue and for the company to achieve a positive operational cashflow more rapidly."
Babcock & Brown's banking syndicate extended its lifeline last week because the investment firm is likely to sell its assets at higher prices than an administrator would.
Babcock & Brown announced a A$150 million ($184 million) loan and the suspension of financial conditions on existing debt until January 9.
Last month Babcock & Brown Infrastructure announced the sale of its stake in New Zealand powerlines and gas company Powerco for $400 million.
The investment firm has seen its market value fall to below A$150 million from a peak of almost A$13 billion last year.
The sale of the share in the windfarm joint venture was conditional on NZ Windfarms passing a shareholders' resolution approving the acquisition, or getting a waiver from NZX Regulation.
It was also conditional on consents from parties to material contracts to the Te Rere Hau venture.
The Te Rere Hau Wind Farm is in the process of developing a total of 97 500kW wind turbines on the Te Rere Hau site, providing a capacity of 48.5 MW. Five turbines have been operating on the site since September 2006 and a further 30 related to the Stage II development are being erected.
Roads and construction pads for Stage III - a further 32 turbines - have been completed, which will enable construction and installation to start early next year.
NZ Windfarms raised $75 million last year in a public offering. Auckland energy supplier Vector took a 19.9 per cent stake.
- NZPA, staff reporter
