SNC Lavalin to sell minority interest in Alberta's electricity transmission business
SNC-Lavalin has hired Morgan Stanley and RBC Capital Markets as financial advisors to sell a minority stake in AltaLink, it's second-largest infrastructure investment and one which owns more than half of Alberta's electricity transmission grid.
Local sources report that Gerry Grigoropoulos, executive vice-president for infrastructure concession investments, said on Monday that all options for AltaLink would be considered, including a private sale, strategic alternatives or turning to the public market.
Grigoropoulos said plans to sell a minority portion of AltaLink will relieve SNC-Lavalin of some of its obligations to fund AltaLink's expansion, which could be valued at $600 million to $1 billion over the next three years.
AltaLink operates about 12,000 kilometres of transmission lines and 280 substations in the province, serving about 85 per cent of the population. It also received regulatory approval in December for a C$1.5-billion transmission line extension to run 350 kilometres from Genessee, west of Edmonton, southward to Langdon, east of Calgary.
Earlier this year, SNC agreed to sell 66 % of its minority interest in Astoria Project Partners II LLC, which owns and operates the gas-fired Astoria II power plant in New York City.
Grigoropoulos also said that SNC's strategic goal is to reinvest those proceeds in the resources sector.
According to analysts, AltaLink is worth upwards of C$1.5 billion, a quarter of SNC-Lavalin's trading price.
Any sale would need the approval of the Alberta Utilities Commission. SNC-Lavalin expects the transaction to be completed by late 2014.
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