PrefBlog

Algonquin Power & Utilities Corp. has announced:

the results of the final instalment payment in respect of its 5.00% convertible unsecured subordinated debentures (“Debentures”) represented by instalment receipts (“Instalment Receipts”). Holders of $1,039,034,075 principal amount of Debentures have elected to convert their Debentures into APUC common shares (“Common Shares”). As a result, APUC has issued 98,022,082 Common Shares to former holders of Debentures. It is expected that $110,965,925 principal amount of Debentures will remain outstanding after giving effect to such conversions.
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Holders of Debentures are reminded that as of today the interest payable on the Debentures has fallen to an annual rate of 0%. As a result, no further interest will accrue or be paid on the Debentures. The Debentures are not and will not be listed on the TSX and may in the future be redeemed by APUC for 100% of their principal amount.

In consequence, Standard & Poor’s has announced:

• •Algonquin Power & Utilities Corp. (APUC) recently announced it had received all of the proceeds under the final installment of the C$1.15 billion convertible debentures that it used to finance the acquisition of Empire District Electric Co., a Missouri-based utility, in February 2016.
• •In addition, to date, holders of approximately 91% of the convertible debentures have elected to convert the debt into APUC ccommon shares, reducing the company’s debt load and lifting expected adjusted funds from operations-to-debt metric above the downgrade threshold.
• •As a result, we are revising our outlook on APUC and its subsidiaries Algonquin Power Co. and Liberty Utilities Co. to stable from negative.
• •We are also affirming our ratings on the companies, including our ‘BBB’ long-term corporate credit rating on APUC.

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The stable outlook reflects S&P Global Ratings’ assessment of APUC’s stable cash flows from its regulated utilities and contracted unregulated power
business, along with its commitment to a balance between debt and equity to fund its acquisition and development activities such that funds from operations-to-debt is 14%-15%.

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