February 18 (Renewables Now) - Canadian Solar Inc (NASDAQ:CSIQ) said today it has finalised the disposal of a 56.3-MWp solar power plant in Japan’s Yamaguchi Prefecture to a subsidiary of Hana Financial Group.
Specifically, Hana Financial Investment has bought the Yamaguchi Shin Mine facility for an enterprise value of about JPY 22.3 billion (USD 203.2m/EUR 187.9m). The transaction was supposed to close during the fourth quarter of 2019 but was delayed because of regulatory and contractual obligations, the seller said. As a result, Canadian Solar will recognise the revenue this quarter.
The Yamaguchi Shin Mine started commercial operation in May 2018 and since then has been selling its output to Chugoku Electric Power Co Inc (TYO:9504) at the rate of JPY 36.0 per kWh. The off-take agreement has a term of 20 years.
Canadian Solar will continue to deliver asset management and operational and maintenance (O&M) services for the plant. Furthermore, the two companies have entered into a five-year profit sharing agreement that will see Canadian Solar generate additional revenue if the solar park outperforms agreed upon metrics.
"This transaction structure ensures that we capture stable, long-term revenue streams for our asset management and operations and maintenance services. We expect to grow this business as we work to enhance and retain greater share of the value creation throughout the life cycle of solar power plants," said Shawn Qu, chairman and CEO of Canadian Solar.
(JPY 10 = USD 0.911/EUR 0.843)