Western Wind mails supplementary directors' circular and makes no
recommendation to shareholders as to whether to accept or reject the
VANCOUVER, British Columbia, Jan. 22, 2013
- TSX.V Symbol: " WND"
- OTCQX Symbol: "WNDEF"
- Issued and Outstanding: 70,462,806
VANCOUVER, British Columbia, Jan. 22, 2013 /PRNewswire/ -- Western Wind Energy
Corp. - (the "Company" or "Western Wind") (TSX Venture Exchange - "WND")
(OTCQX - "WNDEF") announces that it has mailed a supplementary directors'
circular (the "Supplementary Directors' Circular") in response to the offer
(the "Offer") from WWE Equity Holdings Inc. (the "Offeror"), an indirect
subsidiary of Brookfield Renewable Energy Partners L.P. ("Brookfield
Renewable") to Western Wind shareholders to purchase all of the issued and
outstanding shares of Western Wind (the "Shares") for $2.50 in cash per Share,
upon the terms and subject to the conditions set forth in the circular of the
Offeror dated November 26, 2012 (the "Offeror Circular").
The Supplementary Directors' Circular contains NO RECOMMENDATION of the
Western Wind board of directors (the "Board of Directors") as to whether
shareholders of Western Wind (the "Shareholders") should accept or reject the
Offer. Shareholders should consider the information contained in the
Supplementary Directors' Circular carefully and make their own decisions.
Shareholders who are in doubt about how to respond to the Offer, should
consult their investment dealer, stockbroker, lawyer or other professional
Reasons for Making No Recommendation
After careful consideration of the risks and opportunities presented by the
Offer, the members of the special committee of the Board of Directors (the
"Special Committee") found themselves unable to make a recommendation to
Shareholders to accept or reject the Offer. Ultimately, they concluded, it is
a choice that will rest on each Shareholder's personal circumstances, appetite
for risk and tolerance of uncertainty.
On July 30, 2012, the Company announced that it would be seeking a buyer for
the Company and its assets, and that the Board of Directors had established
the Special Committee. On August 10, 2012, the Company announced that it had
engaged Rothschild (Canada) Inc. ("Rothschild") as its lead financial advisor
to manage and structure a comprehensive and efficient auction process, with PI
Financial Corp. engaged as a co-advisor.
On July 31, 2012, Savitr Capital, LLC announced that it intended to nominate
five new directors for election to the Board of Directors. All five of
management's nominees were ultimately elected to the Board of Directors at the
Company's annual general meeting held on September 25, 2012. However, the
Company believes that there was at least an eight week delay in the proper
functioning of the auction process due to the distraction caused by the proxy
After the Company's annual general meeting held on September 25, 2012, the
Board of Directors again focused on the auction process. The auction process
has since been progressing as planned and as part of that process, the Board
of Directors continues to be in discussions with potential buyers. However, no
binding offer has been made as of the date of the Supplementary Directors'
Circular. Several of the parties contacted by Rothschild have executed
confidentiality agreements and conducted due diligence. Initial expressions of
interest were received by the Company, some of which implied a value for the
Company significantly greater than that offered by the Offeror. Seven parties
remain in the process and continue to have access to the data room. Some of
these parties have an interest in an individual asset, while others are
considering an acquisition of the Company as a whole. Further, the Company is
continuing to negotiate non-disclosure agreements with a small number of
qualified parties to gain access to the data room. If they enter into the
auction process, these parties will likely not be in a position to provide
their views on value for several weeks.
Accordingly, while a financially superior offer may be made before the expiry
of the Offer, the Offer is the only offer to purchase all of the outstanding
Shares that is open for acceptance by Shareholders at the date of the
Supplementary Directors' Circular. Shareholders who are attracted by the
certainty of an opportunity to sell their Shares for cash at this time may
prefer to accept the Offer. The Board of Directors does note that the
Company's assets are infrastructure assets generating power under long term
power purchase agreements. Accordingly, the value of these assets is not
expected to be diminished by the success or failure of the Offer.
On the other hand, Western Wind is an independent renewable energy production
company that owns and operates wind and solar generation facilities with 165
net megawatts of rated capacity operating in the states of California and
Arizona. Western Wind also owns substantial development assets for both solar
and wind energy in the United States. See "Western Wind". On January 2, 2013,
Western Wind announced progress towards bringing the Yabucoa project in Puerto
Rico to a financial close, which will create value for Shareholders. In
addition, as part of the recent "fiscal cliff" package, the United States
Congress approved an extension to a certain federal tax credit for wind power.
In the latter months of 2012, the uncertain fate of the wind tax credit
resulted in depressed valuations of companies in the wind power industry.
Shareholders who sell their Shares now, either in the market or by accepting
the Offer, will forego any opportunity to realize the value created by the
Yabucoa project, which could be significant, as well as Western Wind's other
projects including any benefit of the extended federal tax credits for wind
In the view of the Special Committee, the decision of a Shareholder to accept
or reject the Offer will be based on the Shareholder's individual
circumstances, appetite for risk and hope of return. Accordingly, the Special
Committee concluded that the Board of Directors could not usefully make a
recommendation to Shareholders, but should instead strive to provide
Shareholders with all of the relevant information to allow them to make that
decision for themselves.
The Board of Directors adopted the conclusions of the Special Committee and
determined that it would not make a recommendation to Shareholders whether to
accept or reject the Offer.
The following is a summary of the principal reasons why the Special Committee
and the Board of Directors have decided to make NO RECOMMENDATION with respect
to acceptance or rejection of the Offer:
*Although a financially superior offer may be made before the expiry of the
Offer, the Offer is the only offer to purchase all of the outstanding
Shares that is open for acceptance by Shareholders at the date of the
Supplementary Directors' Circular.
*There are other significant risks and uncertainties related to the Offer,
which are described in further detail below. See "Risks Related to the
Risks Related to the Offer
The Offer is subject to a number of risks and uncertainties, including but not
limited to the following:
1.Western Wind has made submissions to staff of the Ontario Securities
Commission in respect of the Offeror's ability to rely on an exemption
from the requirement to obtain a formal valuation in respect of the Offer.
The Special Committee believes that a formal valuation will benefit all
Shareholders in that it will allow them to assess the price offered by the
Offeror relative to the fair market value of the Shares as determined by
an independent valuator.
2.The Offer is highly conditional to the benefit of the Offeror. There are
a number of conditions which are not subject to a materiality threshold or
other objective criteria but provide the Offeror with a broad range of
grounds upon which it may decline to proceed with the Offer.
3.The Offer is subject to the condition that there be validly deposited
under the Offer and not withdrawn at the expiry date of the Offer, Shares
representing more than 50% of the outstanding Shares held by Independent
Shareholders (as defined in the Offeror Circular). However, the Offeror
can waive this minimum tender condition and take up all the Shares
tendered, even if the minimum tender condition is not met. If the Offeror
acquires less than a majority of the Shares, the Company's ability to
effectively carry on its business may be impaired by a poor working
relationship with Brookfield Renewable.
4.The purchase of Shares by the Offeror pursuant to the Offer will reduce
the number of Shares that might otherwise trade publicly and the number of
Shareholders and could, therefore, adversely affect the liquidity and
market value of the remaining Shares held by the public.
5.Under the Offer, the Offeror may gain effective control of the Company
without any obligation to acquire the outstanding Shares that were not
tendered to its bid. This is inherently coercive because a Shareholder may
feel compelled to tender Shares to the Offer, even if the Shareholder
considers the offer price to be inadequate, to avoid the risk that the
Shareholder may be left holding a minority investment at a reduced price
reflective of a minority discount and with significantly less liquidity.
6.In the Offeror Circular, the Offeror has advised that if it cannot
complete a subsequent acquisition transaction, it will evaluate its
alternatives, which may include purchasing Shares in the market, in
privately negotiated transactions, in another take-over bid for Western
Wind, or otherwise, or taking no further action to acquire additional
Shares. Any additional purchases will be at the discretion of the Offeror,
and could be at a price greater than, equal to or less than the Offer
The foregoing is only a summary of the information and factors considered by
the Special Committee and the Board. This summary is not intended to be
exhaustive. Shareholders should read the entire Supplementary Directors'
Circular, which includes further details of the material information, factors
and analysis considered by the Special Committee and the Board.
ABOUT WESTERN WIND ENERGY CORP.
Western Wind is a vertically integrated renewable energy production company
that owns and operates wind and solar generation facilities with 165 net MW of
rated capacity in production, in the States of California and Arizona.
Western Wind further owns substantial development assets for both solar and
wind energy in the U.S. The Company is headquartered in Vancouver, BC and has
branch offices in Scottsdale, Arizona and Tehachapi, California. Western Wind
trades on the TSX Venture Exchange under the symbol "WND", and in the United
States on the OTCQX under the symbol "WNDEF".
The Company owns and operates three wind energy generation facilities in
California, and one fully integrated combined wind and solar energy generation
facility in Arizona. The three operating wind generation facilities in
California are comprised of the 120MW Windstar, the 4.5MW Windridge facilities
in Tehachapi, and the 30MW Mesa wind generation facility near Palm Springs.
The facility in Arizona is the Company's 10.5MW Kingman integrated solar and
wind facility. The Company is further developing wind and solar energy
projects in California, Arizona, and Puerto Rico.
ON BEHALF OF THE BOARD OF DIRECTORS
Jeffrey J. Ciachurski President & Chief Executive Officer
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
Certain statements contained in this news release may constitute
forward-looking information under applicable Canadian securities legislation.
These statements relate to future events and are prospective in nature. All
statements other than statements of historical fact may constitute
forward-looking statements or contain forward-looking information.
Forward-looking statements are often, but not always, identified by the use of
words such as "may", "will", "project", "predict", "potential", "plan",
"continue", "estimate", "expect", "targeting", "intend", "could", "might",
"seek", "anticipate", "should", "believe" or variations thereof.
Forward-looking information may relate to management's future outlook and
anticipated events or results and may include statements or information
regarding the future plans or prospects of the Company.
Forward-looking information is based on certain factors and assumptions
regarding, among other things, the Company's negotiations with prospective
purchasers and the results of due diligence investigations conducted by
prospective purchasers, the Company's ability to successfully negotiate
non-disclosure agreements with interested parties, the availability of a
financially superior offer, the Company's future growth, results of
operations, performance, business prospects and opportunities as well as the
economic environment in which it operates. Several factors could cause actual
results to differ materially from those expressed in the forward-looking
statements, including, but not limited to: actions taken by the Offeror or
Brookfield Renewable, actions taken by the Western Wind Shareholders in
relation to the Offer, the possible effect of the Offer on the Company's
business, the outcome of the Company's previously-announced sale process, the
ability of the Company to successfully negotiate non-disclosure agreements
with interested parties, and the availability of value-maximizing alternatives
relative to the Offer. Additional risks and uncertainties can be found in the
Company's MD&A for the year ended December 31, 2011 and the Company's other
continuous disclosure filings which are available at www.sedar.com .
Forward-looking statements and forward-looking information involve known and
unknown risks, uncertainties and other factors that may cause actual results
or events to differ materially from those anticipated. Forward-looking
information is subject to a variety of known and unknown risks, uncertainties
and other factors that could cause actual events or results to differ from
those reflected in the forward-looking statements including, without
limitation: the progress of Western Wind's sales process, whether the Company
is able to successfully negotiate the terms of non-disclosure agreements with
interested parties, the results of due diligence investigations conducted by
interested parties, and, assuming the Company receives an expression of
interest, whether a financially superior offer for Western Wind emerges,
whether the Company is able to successfully negotiate a prospective sales
transaction and whether the conditions of any proposed transaction, including
receipt by the Company of all necessary approvals, are met.
The Board of Directors believes that the expectations reflected in the
forward-looking statements contained in this news release are reasonable, but
no assurance can be given that they will prove to be correct. Actual results
and future events may differ materially from those anticipated and accordingly
forward-looking statements should not be unduly relied upon. Forward-looking
statements contained in this document speak only as of the date of this news
release. Except as required by applicable law, Western Wind disclaims any
obligation to update any forward-looking information.
For further information:
Investor Relations Contact:
Lawrence Casse AlphaEdge
Tel: +1-416-992-7227Email: firstname.lastname@example.org
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