New York City, June 2, 2011 – Laidlaw Energy Group, Inc. executed a final purchase and sales agreement to acquire a 14 MW biomass-energy power plant located in Susanville, California. LLEG will be the 100 percent equity holder.
The sellers of the Susanville plant are Renegy, Inc., an entity controlled by Robert M. Worsley, founder of SkyMall, Inc., and Nature Energies, Inc., whose parent is Hanalei Renewables, a French renewable energy company. Both companies will become equity holders in Laidlaw Energy and will be issued a new class of preferred shares.
Laidlaw Energy plans to refurbish the Susanville plant, a process that is expected to take about 12 months and cost about $20 million. The cost of refurbishment is expected to largely be funded via a bank loan guaranteed through a program provided by the federal government, along with a federal grant for which the project is expected to qualify.
Laidlaw anticipates that once the plant is operational it will generate revenues of about $8 million to $9 million per year. A 20- to 30-year power purchase agreement is being negotiated.
The final closing is expected to occur shortly once Laidlaw has received certain consents to the transfer of some agreements from the sellers to Laidlaw. This is not anticipated to create any issues for the closing.