NextEra files for yieldco IPO

NextEra Energy announced that it confidentially submitted a draft registration statement to US regulators relating to a proposed initial public offering of common equity of a yieldco vehicle for its renewable energy business.

The number of securities to be sold and the price range for the proposed offering have not yet been determined, chief executive Jim Robo told analysts on a conference call.

The IPO is expected to commence after the Securities and Exchange Commission (SEC) completes its review process, subject to market and other conditions.

NextEra hopes this review will conclude in several weeks as opposed to several months, according to chief financial officer Moray Dewhurst.

Separately, NextEra reported first quarter net income of $430m, or 98 cents a share, versus $272m, or 64 cents a year earlier.

Robo says until the so-called S-1 statement submitted 4 April is made public, the company can’t discuss the exact projects or megawatts involved over time – or the financial performance of the assets that NextEra expects to make available for purchase by the yieldco.

NextEra’s Energy Resources division is the largest US owner of wind and solar assets, and since last decade has been the number one generator of energy from those sources.

Robo says that the long-term objective is to create value for NextEra shareholders. “One area of focus for us is to be able to ensure as close an alignment of interests as possible between our existing shareholders and investors in the yieldco vehicle. We believe we have developed a suitable structure to support his aim,” he says.

The company says it will continue to place emphasis on development of new, high-quality contracted projects at Energy Resources.