TransAlta Corporation Announces Conversion Results for Series E and F Preferred Shares
Further to TransAlta Corporation’s (“TransAlta” or the “Company”) (TSX: TA)(NYSE: TAC) press release dated August 31, 2022, the Company announced today that after taking into account all election notices received for the conversion of the Cumulative Redeemable Rate Reset Preferred Shares, Series E (the Series E Shares) into Cumulative Redeemable Floating Rate Preferred Shares, Series F (the Series F Shares), there were only 89,945 Series E Shares tendered for conversion, which is less than the one million shares required to give effect to conversions into Series F Shares. As a result, none of the Series E Shares will be converted into Series F Shares on September 30, 2022.
About TransAlta:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydro-electric power. For over 111 years, TransAlta has been a responsible operator and a proud member of the communities where we operate and where our employees work and live. TransAlta aligns its corporate goals with theUN Sustainable Development Goalsand its climate change strategy with CDP (formerly Climate Disclosure Project) and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.TransAlta hasachieved a 61 per cent reduction in GHG emissions since 2015.
For more information about TransAlta, visit its website at transalta.com.
TransAlta Corporation Provides Notice of Series E Preferred Shares Conversion Right and Announces Reset Dividend Rates
TransAlta Corporation (TransAlta or the Company) (TSX: TA; NYSE: TAC) announced today that it does not intend to exercise its right to redeem all or any part of the currently outstanding cumulative redeemable rate reset first preferred shares Series E (Series E Shares) (TSX: TA.PR.H) on September 30, 2022 (the Conversion Date).
As a result and subject to certain conditions set out in the prospectus supplement dated August 3, 2012 relating to the issuance of the Series E Shares, the holders of the Series E Shares will have the right to convert all or any of their Series E Shares into cumulative redeemable floating rate first preferred shares Series F of the Company (Series F Shares) on the basis of one Series F Share for each Series E Share on the Conversion Date.
With respect to any Series E Shares that remain outstanding after September 30, 2022, holders thereof will be entitled to receive quarterly fixed cumulative preferential cash dividends, if, as and when declared by the Board of Directors of TransAlta. The annual dividend rate for the Series E Shares for the five-year period from and including September 30, 2022 to but excluding September 30, 2027, will be 6.89400%, being equal to the five-year Government of Canada bond yield of 3.24400% determined as of today plus 3.65000%, in accordance with the terms of the Series E Shares.
With respect to any Series F Shares that may be issued on September 30, 2022, holders thereof will be entitled to receive quarterly floating rate cumulative preferential cash dividends, if, as and when declared by the Board of Directors of TransAlta. The annual dividend rate for the 3-month floating rate period from and including September 30, 2022 to but excluding December 31, 2022 will be 6.96800%, being equal to the annual rate for the most recent auction of 90-day Government of Canada Treasury Bills of 3.31800% plus 3.65000%, in accordance with the terms of the Series E Shares (the Floating Quarterly Dividend Rate). The Floating Quarterly Dividend Rate will be reset every quarter.
As provided in the terms of the Series E Shares, if TransAlta determines after reviewing all Series E Shares tendered for conversion into Series F Shares that: (i) there would remain outstanding on September 30, 2022, less than 1,000,000 Series E Shares, all remaining Series E Shares shall be converted automatically into Series F Shares on a one-for one basis effective September 30, 2022; or (ii) there would remain outstanding after September 30, 2022, less than 1,000,000 Series F Shares, the holders of Series E Shares shall not be entitled to convert their shares into Series F Shares effective September 30, 2022. There are currently 9,000,000 Series E Shares outstanding.
The Series E Shares are issued in book entry only form and must be purchased or transferred through a participant in the CDS depository service (CDS Participant). All rights of holders of Series E Shares must be exercised through CDS or the CDS Participant through which the Series E Shares are held. The deadline for the registered shareholder to provide notice of exercise of the right to convert Series E Shares into Series F Shares is 3:00 p.m. (MST) / 5:00 p.m. (EST) on September 15, 2022. Any notices received after this deadline will not be valid. As such, holders of Series E Shares who wish to exercise their right to convert their shares should contact their broker or other intermediary for more information and it is recommended that this be done well in advance of the deadline in order to provide the broker or other intermediary with time to complete the necessary steps.
If TransAlta does not receive an election notice from a holder of Series E Shares during the time fixed therefor, then the Series E Shares shall be deemed not to have been converted (except in the case of an automatic conversion). Holders of the Series E Shares and the Series F Shares will have the opportunity to convert their shares again on September 30, 2027, and every five years thereafter as long as the shares remain outstanding.
As previously announced on July 27, 2022, holders of Series E shares as of the record date of September 1, 2022 will receive a dividend of $0.32463 payable on September 30, 2022, in respect of the period starting from and including June 30, 2022 up to but excluding September 30, 2022, regardless of whether the holder elects to convert their Series E Shares into Series F Shares on the Conversion Date.
The Toronto Stock Exchange (TSX) has conditionally approved the listing of the Series F Shares effective upon conversion. Listing of the Series F Shares is subject to TransAlta fulfilling all the listing requirements of the TSX.
About TransAlta:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydro-electric power. For over 111 years, TransAlta has been a responsible operator and a proud member of the communities where we operate and where our employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals and its climate change strategy with CDP (formerly Climate Disclosure Project) and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.TransAlta hasachieved a 61 per cent reduction in GHG emissions since 2015.
For more information about TransAlta, visit its website at transalta.com. Forward Looking Information:
This news release contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as may, will, should, estimate, intend or other similar words). Specifically, this news release contains forward-looking information with respect to the Company, the Series E Shares and the Series F Shares, including but not limited to future conversions, redemptions and dividends. All forward-looking information reflect the Company’s beliefs and assumptions based on information available at the time the statements were made and as such are not guarantees of future performance. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this press release. TransAlta undertakes no obligation to update or revise any forward-looking information except as required by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from those in the forward-looking information, refer to the Company’s Annual Report and Management’s Discussion and Analysis, and the risks set out in the prospectus supplement dated August 3, 2012 relating to the issuance of the Series E Shares, filed under the Company’s profile on SEDAR at www.sedar.com and with the U.S. Securities and Exchange Commission at www.sec.gov.
Adjusted EBITDA(1),(2) of $279 million, in line with expectations, a decrease of 13% over the same period in 2021
Free Cash Flow (“FCF”)(1) of $145 million, or $0.54 per share, a decrease of $0.03 on a per-share basis compared to the same period in 2021
Loss before income taxes of $22 million, a decrease of $94 million from the same period in 2021
Net loss attributable to common shareholders of $80 million or $0.30 per share, compared to a loss of $0.04 per share for the same period in 2021
Cash flow used in operating activities of $129 million, an increase of $209 million from same period in 2021
Other Business Highlights
Announced a 10-year contract extension, receipt of waiver from bondholders and commencement of rehabilitation plan at Kent Hills wind facilities
Announced the 200 MW Horizon Hill wind project supplying Meta with renewable power under a long-term Power Purchase Agreement (PPA)
Secured capacity commitment extensions for three of the large industrial customers at the Sarnia cogeneration facility (one to 2031 and two to 2032)
Reached agreement with BHP Nickel West to expand the Mount Keith 132kV transmission system in Western Australia
Executed a long-term PPA for the remaining 30 MW of capacity at the Garden Plain wind project
Added 325 MW to our renewable development pipeline in Canada and the United States
Received an upgraded MSCI ESG Rating of ‘A’ from ‘BBB’
Announced a US$25 million investment in Energy Impact Partners Deep Decarbonization Frontier Fund 1
Received a decision from the Court of Appeal upholding TransAlta’s favourable force majeure arbitration decision
In the year-to-date returned $18 million of capital to common shareholders through share buybacks of 1.4 million common shares
Launched our new visual identity and “Energizing the Future” campaign
Completed the conversion of elected Series C to Series D Preferred Shares which began trading on the TSX on June 30, 2022 under the symbol TA.PR.G
TransAlta Corporation (TransAlta or the Company) (TSX: TA) (NYSE: TAC) today reported its financial results for the three and six months ended June 30, 2022.
“TransAlta delivered solid second quarter results for 2022. Our Alberta Electricity Portfolio performed as anticipated, despite higher natural gas prices and compressed market heat rates, demonstrating the value of our strategically diversified fleet in Alberta and its ability to generate cash flow under dynamic market conditions. Our Alberta Wind and Hydro segments led our results, benefiting from the higher pricing environment and stronger production. Our Alberta Gas segment had limited opportunity to benefit from higher power prices realized in the market as it was highly hedged during the quarter,” said John Kousinioris, President and Chief Executive Officer. “The contributions from our new contracted assets at Windrise and North Carolina Solar and the exceptional results in our Energy Marketing segment further supported our financial results for the quarter as we continue to track towards the midpoint of our 2022 guidance.”
Set out below are additional highlights from the quarter on TransAlta’s business activities, including the Company’s progress on advancing its Clean Electricity Growth Plan as well as details regarding the Company’s financial performance and liquidity.
Key Business Developments
Kent Hills Wind Facility Outage Update
On June 2, 2022, TransAlta Renewables announced its rehabilitation plan for the Kent Hills wind facilities together with the execution of amended and extended contracts with New Brunswick Power Corporation (“NB Power”) in respect of each of the Kent Hills 1, 2 and 3 wind facilities providing for an additional 10-year period to December 2045 and an effective 10 per cent reduction to the original contract prices from January 2023 through December 2033. In addition, both parties have agreed to work in good faith to evaluate the installation of a battery energy storage system at Kent Hills and to consider a potential repowering of Kent Hills at the end of life in 2045. The Company also obtained a waiver for the Kent Hills wind non-recourse bonds (“KH Bonds”) from the project bond holders and entered into a supplemental indenture with the bond holders that facilitates the rehabilitation of the Kent Hills 1 and 2 wind facilities.
Horizon Hill Wind Project and Fully Executed Corporate PPA with Meta
On April 5, 2022, TransAlta executed a long-term renewable energy PPA with a subsidiary of Meta Platforms Inc. (“Meta”), formerly known as Facebook, Inc., for 100 per cent of the generation from its 200 MW Horizon Hill wind project to be located in Logan County, Oklahoma. Under this agreement, Meta will receive both renewable electricity and environmental attributes from the Horizon Hill facility. The facility will consist of a total of 34 Vestas turbines with construction expected to begin in late 2022 and a target commercial operation date in the second half of 2023. TransAlta will construct, operate and own the facility. Total construction capital is estimated between US$290 million and US$310 million and is expected to be financed with a combination of existing liquidity and tax equity financing. Over 90 per cent of project costs are fixed under executed turbine supply agreements and engineering, procurement and construction agreements. The project is expected to generate average annual EBITDA between US$27 million and US$30 million, inclusive of production tax credits.
Sarnia Cogeneration Facility Contract Extensions
During the second quarter of 2022, the Company executed contract extensions for the supply of electricity and/or steam with the remaining three of its industrial customers at the Sarnia cogeneration facility. These agreements will extend the delivery term for electricity and/or steam from Dec. 31, 2022 to April 30, 2031, in one case, and to Dec. 31, 2032, for the other two, with all agreements being subject to certain conditions, including the Company entering into a new contract with the Ontario Independent Electricity System Operator (the IESO). The current contract with the IESO, in respect of the Sarnia cogeneration facility expires on Dec. 31, 2025. On July 19, 2021, the IESO released its Annual Acquisition Report, which included draft details for medium- and long-term procurement mechanisms for capacity for 2026 and beyond for existing and new generation. The Company has bid into the procurement process developed by the IESO and is seeking to secure a contract extension for the Sarnia cogeneration facility following the end of the current contract term. The Company expects the IESO to announce the successful bids in the third quarter of 2022.
Mount Keith 132kV Transmission Expansion
On May 3, 2022, TransAlta Renewables exercised its option to acquire an economic interest in the expansion of the Mount Keith 132kV transmission system in Western Australia, to support the Northern Goldfields-based operations of BHP Nickel West (“BHP”). Total construction capital is estimated at between AU$50 million and AU$53 million. Southern Cross Energy, a subsidiary of the Company, has entered into an engineering, procurement and construction agreement for the expansion. The project is being developed under the existing PPA with BHP, which has a term of 15 years. It is expected to be completed in the second half of 2023 and will generate annual EBITDA in the range of AU$6 million to AU$7 million. The project will facilitate the connection of additional generating capacity to our network to support BHP’s operations and increase their competitiveness as a supplier of low-carbon nickel.
Executed Long Term PPA for Remaining 30 MW at Garden Plain
During the second quarter of 2022, the Company entered into a long-term PPA for the remaining 30 MW of renewable electricity and environmental attributes at the Garden Plain wind project in Alberta with a new investment-grade globally recognized customer. The 130 MW Garden Plain wind project, which was announced in May 2021 with a 100 MW PPA contracted to Pembina Pipeline Corporation (“Pembina”), is now fully contracted with a weighted average contract life of approximately 17 years. Construction is underway with a target commercial operation date in the second half of 2022.
Customer Update at White Rock Wind Facilities
During the second quarter of 2022, TransAlta identified Amazon Energy LLC (Amazon) as the customer for the 300 MW White Rock Wind projects, to be located in Caddo County, Oklahoma. On Dec. 22, 2021, Amazon and TransAlta entered into two long-term PPAs for the supply of 100 per cent of the generation from the projects. Construction is expected to begin in the second half of 2022 with a target commercial operation date in the second half of 2023.
Energy Impact Partners (“EIP”) Investment
During the second quarter of 2022, The Company has entered into a commitment to invest US$25 million over the next four years in EIP’s Deep Decarbonization Frontier Fund 1 (the “Frontier Fund”) that will invest in early-stage, innovative technology companies that will accelerate the transition to net-zero greenhouse gas emissions. TransAlta’s investment in the Frontier Fund provides the Company with the opportunity to identify, pilot, commercialize and bring to market emerging technologies that will support its decarbonization goals.
MSCI Environmental, Social and Governance (“ESG”) Rating Upgrade
During the second quarter of 2022, TransAlta’s MSCI ESG Rating was upgraded to ‘A’ from ‘BBB’. The upgrade reflects the Company’s strong renewable energy growth compared to peers. In 2021, the Company grew its installed renewable energy capacity by 15 per cent through acquisition and construction of solar and wind facilities and secured 600 MW in additional renewable energy projects. In line with its goal to reduce carbon emissions by 75 per cent from 2015 emissions levels by 2026, TransAlta also completed coal-to-gas conversions of its Canadian coal-fired facilities in 2021, nine years ahead of Alberta’s coal phase-out plan.
Court of Appeal Upholds TransAlta’s Favourable Force Majeure Arbitration Decision
On June 9, 2022, the Alberta Court of Appeal released a unanimous decision dismissing ENMAX Energy Corporation’s and the Balancing Pool’s application seeking to set aside an arbitration decision in favour of the Company. The Court of Appeal upheld the Company’s claim of force majeure that arose when its Keephills 1 generating unit tripped offline in 2013. As a result of the decision, the Company’s claim of force majeure remains valid and the associated costs of the force majeure event will not be reassessed against TransAlta.
TSX Acceptance of Normal Course Issuer Bid
On May 24, 2022, the Toronto Stock Exchange (TSX) accepted the notice filed by the Company to renew its normal course issuer bid (NCIB) for a portion of its common shares. Pursuant to the NCIB, TransAlta may repurchase up to a maximum of 14,000,000 common shares, representing approximately 7.16 per cent of its public float of common shares as at May 17, 2022. Purchases under the NCIB may be made through open market transactions on the TSX and any alternative Canadian trading platforms on which the common shares are traded, based on the prevailing market price. Any common shares purchased under the NCIB will be cancelled. The period during which TransAlta is authorized to make purchases under the NCIB commenced on May 31, 2022 and ends on May 30, 2023, or such earlier date on which the maximum number of common shares are purchased under the NCIB or the NCIB is terminated at the Company’s election.
The NCIB provides the Company with a capital allocation alternative with a view to ensuring long-term shareholder value. TransAlta’s Board of Directors and Management believe that, from time to time, the market price of the common shares does not reflect their underlying value and purchases of common shares for cancellation under the NCIB may provide an opportunity to enhance shareholder value.
During the six months ended June 30, 2022, the Company purchased and cancelled a total of 1.4 million common shares at an average price of $12.50 per common share, for a total cost of $18 million.
Conversion Results for Series C and D Preferred Shares
On June 16, 2022, the Company announced that 1,044,299 of its 11,000,000 currently outstanding Cumulative Redeemable Rate Reset First Preferred Shares, Series C (Series C Shares) were tendered for conversion, on a one-for-one basis, into Cumulative Redeemable Floating Rate First Preferred Shares, Series D (Series D Shares) after having taken into account all election notices following the June 15, 2022 conversion deadline.
TransAlta Debuts New Brand Reiterating Commitment to a Clean Energy Future
On June 20, 2022, the Company announced a new visual identity including logo and tagline “Energizing the Future”. The new visual identity encapsulates the TransAlta of today while reinforcing the Company’s focus as a leader in creating a carbon-neutral future for our customers.
Liquidity and Financial Position
The Company continues to maintain a strong financial position in part due to long-term contracts and hedged positions. At the end of the second quarter, TransAlta had access to $1.9 billion in liquidity, including $0.9 billion in cash and cash equivalents.
Accelerated Clean Electricity Growth Plan
On Sept 28, 2021, the Company announced the strategic targets associated with its Clean Electricity Growth Plan.
As of August 4, 2022, the Company has made significant progress in achieving the targets of the Clean Electricity Growth Plan. Refer to Strategy and Capability to Deliver Results in the Company’s Management’s Discussion and Analysis (MD&A) for further details.
Clean Electricity Growth Plan Targets
Target
% of Target Achieved
Renewable Energy Capacity
2 GW
40%
Capital Investment
$3 Billion
48%
Incremental EBITDA
$250 Million
54%
During the second quarter, the Company added 325 MW to its renewable development pipeline across Canada and the United States.
Second Quarter 2022 Highlights
$ millions, unless otherwise stated
3 months ended
6 months ended
June 30, 2022
June 30, 2021
June 30, 2022
June 30, 2021
Adjusted availability (%)
87.3
84.8
88.2
86.7
Production (GWh)
4,461
4,688
9,820
10,229
Revenues
458
619
1,193
1,261
Adjusted EBITDA(1)
279
319
538
641
Earnings (loss) before income taxes
(22)
72
220
93
Net earnings (loss) attributable to common shareholders
(80)
(12)
106
(42)
Cash flow (used in) from operating activities
(129)
80
322
337
FFO(1)
220
267
399
490
FCF(1)
145
155
253
296
Net earnings (loss) per share attributable to common shareholders, basic and diluted
The Board of Directors of TransAlta Corporation (TSX: TA) (NYSE: TAC) declared a quarterly dividend of $0.05 per common share payable on October 1, 2022 to shareholders of record at the close of business on September 1, 2022.
The Board of Directors also declared the following quarterly dividend on its Cumulative Redeemable Rate Reset First Preferred Shares for the period starting from and including June 30, 2022 up to but excluding September 30, 2022:
Preferred Shares
TSX Stock Symbol
Dividend Rate
Dividend Per Share
Record Date
PaymentDate
Series A
TA.PR.D
2.877%
$0.17981
September 1, 2022
September 30, 2022
Series B*
TA.PR.E
3.507%
$0.22099
September 1, 2022
September 30, 2022
Series C
TA.PR.F
5.854%
$0.36588
September 1, 2022
September 30, 2022
Series D*
TA.PR.G
4.577%
$0.28841
September 1, 2022
September 30, 2022
Series E
TA.PR.H
5.194%
$0.32463
September 1, 2022
September 30, 2022
Series G
TA.PR.J
4.988%
$0.31175
September 1, 2022
September 30, 2022
*Please note the quarterly floating rate on the Series B and Series D Preferred Shares will be reset every quarter.
All currency is expressed in Canadian dollars except where noted. When the dividend payment date falls on a weekend or holiday, the payment is made the following business day.
About TransAlta Corporation:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydro-electric power. For over 111 years, TransAlta has been a responsible operator and a proud member of the communities where we operate and where our employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals and its climate change strategy with CDP (formerly Climate Disclosure Project) and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.TransAlta hasachieved a 61 per cent reduction in GHG emissions since 2015.
For more information about TransAlta, visit its website at transalta.com.
Correction Notice to Media Advisory Regarding Release Date of TransAlta Renewables Second Quarter 2022 Results
TransAlta Corporation (TransAlta) (TSX: TA) (NYSE: TAC) announced today a correction to its media advisory issued July 6, 2022 in respect to the release date of TransAlta Renewables Inc. (TransAlta Renewables) (TSX:RNW) second quarter 2022 results. The correct date for the release of TransAlta Renewables second quarter 2022 results is before markets open on Thursday, August 4, 2022. TransAlta’s second quarter 2022 results will be released before markets open on Friday, August 5, 2022.
Any questions regarding TransAlta Renewables may be asked on the TransAlta conference call beginning at 9:00 a.m. Mountain Time (11:00 a.m. ET) on Friday, August 5, 2022. Details for the TransAlta second quarter 2022 conference call are available on the Investor Centre section of TransAlta’s website at https://transalta.com/investors/presentations-and-events/.
About TransAlta:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydro-electric power. For over 111 years, TransAlta has been a responsible operator and a proud member of the communities where we operate and where our employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals and its climate change strategy with CDP (formerly Climate Disclosure Project) and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.TransAlta hasachieved a 61 per cent reduction in GHG emissions since 2015.
For more information about TransAlta, visit its website at transalta.com.
Media Advisory: TransAlta and TransAlta Renewables Second Quarter 2022 Results and Conference Call
TransAlta Corporation (TransAlta) (TSX: TA) (NYSE: TAC) will release its second quarter 2022 results before markets open on Friday, August 5, 2022. A conference call and webcast to discuss the results will be held for investors, analysts, members of the media and other interested parties the same day beginning at 9:00 a.m. Mountain Time (11:00 a.m. ET). The media will be invited to ask questions following analysts.
TransAlta Renewables Inc. (TransAlta Renewables) (TSX:RNW) will release its second quarter 2022 results before markets on Friday, August 5, 2022. Any questions regarding TransAlta Renewables may be asked on the TransAlta conference call.
Second Quarter 2022 Conference Call:Toll-free North American participants call: 1-888-664-6392 Webcast link: https://app.webinar.net/V5LmNByb3Ya
Related materials will be available on the Investor Centre section of TransAlta’s website at https://transalta.com/investors/presentations-and-events/. If you are unable to participate in the call, the instant replay is accessible at 1-888-390-0541 (Canada and USA toll free) with TransAlta pass code 715647 followed by the # sign. A transcript of the broadcast will be posted on TransAlta’s website once it becomes available.
About TransAlta:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydro-electric power. For over 111 years, TransAlta has been a responsible operator and a proud member of the communities where we operate and where our employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals and its climate change strategy with CDP (formerly Climate Disclosure Project) and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.TransAlta hasachieved a 61 per cent reduction in GHG emissions since 2015.
For more information about TransAlta, visit its website at transalta.com.
About TransAlta Renewables Inc.:
TransAlta Renewables is among the largest of any publicly traded renewable independent power producers (IPP) in Canada. Our asset platform and economic interests are diversified in terms of geography, generation and counterparties and consist of interests in 26 wind facilities, 13 hydroelectric facilities, eight natural gas generation facilities, two solar facilities, one natural gas pipeline, and one battery storage project, representing an ownership interest of 2,968 megawatts of owned generating capacity, located in the provinces of British Columbia, Alberta, Ontario, Québec, New Brunswick, the States of Pennsylvania, New Hampshire, Wyoming, Massachusetts, Michigan, Minnesota, North Carolina, Washington and the State of Western Australia.
For more information about TransAlta Renewables, visit its web site at transaltarenewables.com.
TransAlta Corporation Debuts New Brand Reiterating Commitment to a Clean Energy Future
Today, TransAlta Corporation (TSX: TA; NYSE: TAC) (“TransAlta”) announced a new visual identity including logo and tagline. The new visual identity encapsulates the TransAlta of today while reinforcing the Company’s focus as a leader in creating a carbon-neutral future for our customers.
This rebranding coincides with a key milestone for the company 111 years have passed since the company first began generating power in the foothills west of Calgary.
With a diversified portfolio of generation assets that includes wind, solar, hydro and gas, operating in Canada, the United States and Australia, and a robust portfolio of growth projects, TransAlta is well-positioned to support the global effort to decarbonize with the clean, reliable, and low-cost electricity customers need to successfully transition.
“Today, we are presenting a new look to our customers and stakeholders, one that speaks to a clean future and aligns with our company’s purpose statement that clean power is fundamental to moving the world forward” – said President and CEO John Kousinioris. “From our transition off coal in Canada to the renewable projects we are building and operating for our customers, it is a proud moment for our Company. Our new visual identity conveys that TransAlta is moving forward with purpose having made the investments necessary to achieve significant carbon reductions in our generation portfolio while building out a renewables fleet that will help our customers achieve their decarbonization goals. We truly are energizing the future.”
For our customers, our employees, and the communities in which we operate, TransAlta’s new brand stands for momentum, evolution and energy. The brand is bold, dynamic, and progressive.
Brand updates include:
Updated logo design the custom-designed logo gives a nod to our core business. The three “A”s in the Company name resemble electrical coils, in perpetual motion and represent the change in and evolution of the sector in general and TransAlta in particular. The Company will focus on the conversion of all digital and physical assets of its brand, signage, and materials for the remainder of 2022 and into 2023.
New website The Company’s external website has been transformed to reflect the new brand and functionality to meet the needs of customers, investors, and stakeholders.
About TransAlta Corporation:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy-efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydroelectric power. For over 100 years, TransAlta has been a responsible operator and a proud community-member where its employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals.
For more information about TransAlta, visit our web site at transalta.com.
Forward Looking Information:
This news release contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as “may”, “will”, “should”, “estimate”, “intend” or other similar words). Specifically, this news release contains forward-looking information with respect to the Company, the Series C Shares and the Series D Shares, including but not limited to the listing of the Series D Shares and the quantum and payment of dividends on the Series C Shares and Series D Shares in the future. All forward- looking information reflects the Company’s beliefs and assumptions based on information available at the time the statements were made and as such are not guarantees of future performance. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this press release. TransAlta undertakes no obligation to update or revise any forward-looking information except as required by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from those in the forward-looking information, refer to the Company’s Annual Information Form, Annual Report and Management’s Discussion and Analysis filed under the Company’s profile on SEDAR at www.sedar.com and with the U.S. Securities and Exchange Commission at www.sec.gov.
TransAlta Corporation Announces Conversion Results for Series C and D Preferred Shares
Further to TransAlta Corporation’s (TransAlta or the Company) (TSX: TA; NYSE: TAC) press release dated May 31, 2022, the Company announced today that 1,044,299 of its 11,000,000 currently outstanding Cumulative Redeemable Rate Reset First Preferred Shares, Series C (Series C Shares) were tendered for conversion, on a one-for-one basis, into Cumulative Redeemable Floating Rate First Preferred Shares, Series D (Series D Shares) after having taken into account all election notices following the June 15, 2022 conversion deadline. As a result, on June 30, 2022, the Company will have 9,955,701 Series C Shares issued and outstanding and 1,044,299 Series D Shares issued and outstanding.
The Series C Shares will continue to be listed on the Toronto Stock Exchange (TSX) under the symbol TA.PR.F. The Series D Shares will begin trading on the TSX on June 30, 2022 under the symbol TA.PR.G, subject to the Company fulfilling all the listing requirements of the TSX. The Toronto Stock Exchange has conditionally approved the listing of the Series D Shares effective upon conversion.
The Series C Shares will pay fixed cumulative preferential cash dividends on a quarterly basis, for the five-year period from and including June 30, 2022 to but excluding June 30, 2027, if, as and when declared by the Board of Directors of TransAlta based on an annual fixed dividend rate of 5.85400%, being equal to the five-year Government of Canada bond yield of 2.75400% determined as of May 31, 2022, plus 3.10000%, in accordance with the terms of the Series C Shares.
The Series D Shares will pay quarterly floating rate cumulative preferential cash dividends for the five-year period from and including June 30, 2022 to but excluding June 30, 2027, if, as and when declared by the Board of Directors of TransAlta. The annual dividend rate for the Series D Shares for the 3-month floating rate period from and including June 30, 2022 to but excluding September 30, 2022 will be 4.57700%, being equal to the annual rate for the auction of 90-day Government of Canada Treasury Bills as of May 31, 2022 of 1.47700%, plus 3.10000%, in accordance with the terms of the Series D Shares.
For more information on the terms and risks associated with an investment in the Series C Shares and the Series D Shares, please see TransAlta’s prospectus supplement dated November 23, 2011 which is available on SEDAR at www.sedar.com or on TransAlta’s website at transalta.com. The Series C Shares and the Series D Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the U.S. Securities Act) or the securities laws of the United States. Accordingly, the Series C Preferred Shares and the Series D Preferred Shares may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons, except pursuant to transactions exempt from registration under the U.S. Securities Act or under the securities laws of the applicable state. This press release does not constitute an offer to sell or a solicitation of an offer to buy any security.
About TransAlta Corporation:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy-efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydroelectric power. For over 100 years, TransAlta has been a responsible operator and a proud community-member where its employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals.
For more information about TransAlta, visit our web site at transalta.com.
Forward Looking Information:
This news release contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as may, will, should, estimate, intend or other similar words). Specifically, this news release contains forward-looking information with respect to the Company, the Series C Shares and the Series D Shares, including but not limited to the listing of the Series D Shares and the quantum and payment of dividends on the Series C Shares and Series D Shares in the future. All forward- looking information reflects the Company’s beliefs and assumptions based on information available at the time the statements were made and as such are not guarantees of future performance. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this press release. TransAlta undertakes no obligation to update or revise any forward-looking information except as required by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from those in the forward-looking information, refer to the Company’s Annual Information Form, Annual Report and Management’s Discussion and Analysis filed under the Company’s profile on SEDAR at www.sedar.com and with the U.S. Securities and Exchange Commission at www.sec.gov.
Court of Appeal Upholds TransAlta’s Favourable Force Majeure Arbitration Decision
TransAlta Corporation (TransAlta or the Company) (TSX: TA) (NYSE: TAC) announced that the Alberta Court of Appeal released a unanimous decision today dismissing an application filed by ENMAX Energy Corporation (ENMAX) and the Balancing Pool seeking to set aside an arbitration decision in favour of TransAlta. The Court of Appeal upheld the Company’s claim of force majeure that arose when its Keephills 1 generating unit tripped off-line in 2013. As a result of the decision, the Company’s claim of force majeure remains valid and the associated costs of the force majeure event will not be reassessed against TransAlta.
Additional Background
TransAlta Generation Partnership (TransAlta) was the owner and ENMAX was the buyer under the Keephills Power Purchase Arrangement (the PPA). On March 5, 2013, the Keephills 1 facility tripped off-line due to a suspected winding failure within the generator and did not return to service until October 6, 2013. TransAlta claimed force majeure relief under the terms of the PPA. ENMAX and the Balancing Pool disputed the force majeure claim and initiated an arbitration against TransAlta. In November 2016, an independent arbitration panel unanimously concluded that TransAlta was entitled to the force majeure relief and was therefore not obligated to pay approximately $167.6 million of availability incentive payments plus associated interest.
About TransAlta Corporation:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy-efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydroelectric power. For over 100 years, TransAlta has been a responsible operator and a proud community member where its employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals.
For more information about TransAlta, visit our web site at transalta.com.
Note: All financial figures are in Canadian dollars unless otherwise indicated.
Court of Appeal Upholds TransAlta’s Favourable Force Majeure Arbitration Decision
TransAlta Corporation (TransAlta or the Company) (TSX: TA; NYSE: TAC) announced today that it does not intend to exercise its right to redeem all or any part of the currently outstanding cumulative redeemable rate reset first preferred shares Series C (Series C Shares) (TSX: TA.PR.F) on June 30, 2022 (the Conversion Date).
As a result and subject to certain conditions set out in the prospectus supplement dated November 23, 2011 relating to the issuance of the Series C Shares, the holders of the Series C Shares will have the right to convert all or any of their Series C Shares into cumulative redeemable floating rate first preferred shares Series D of the Company (Series D Shares) on the basis of one Series D Share for each Series C Share on the Conversion Date.
With respect to any Series C Shares that remain outstanding after June 30, 2022, holders thereof will be entitled to receive quarterly fixed cumulative preferential cash dividends, if, as and when declared by the Board of Directors of TransAlta. The annual dividend rate for the Series C Shares for the five-year period from and including June 30, 2022 to but excluding June 30, 2027, will be 5.85400%, being equal to the five-year Government of Canada bond yield of 2.75400% determined as of today plus 3.10000%, in accordance with the terms of the Series C Shares.
With respect to any Series D Shares that may be issued on June 30, 2022, holders thereof will be entitled to receive quarterly floating rate cumulative preferential cash dividends, if, as and when declared by the Board of Directors of TransAlta. The annual dividend rate for the 3-month floating rate period from and including June 30, 2022 to but excluding September 30, 2022 will be 4.57700%, being equal to the annual rate for the most recent auction of 90-day Government of Canada Treasury Bills of 1.47700% plus 3.10000%, in accordance with the terms of the Series D Shares (the Floating Quarterly Dividend Rate). The Floating Quarterly Dividend Rate will be reset every quarter.
As provided in the terms of the Series C Shares, if TransAlta determines after reviewing all Series C Shares tendered for conversion into Series D Shares that: (i) there would remain outstanding on June 30, 2022, less than 1,000,000 Series C Shares, all remaining Series C Shares shall be converted automatically into Series D Shares on a one-for one basis effective June 30, 2022; or (ii) there would remain outstanding after June 30, 2022, less than 1,000,000 Series D Shares, the holders of Series C Shares shall not be entitled to convert their shares into Series D Shares effective June 30, 2022. There are currently 11,000,000 Series C Shares outstanding.
The Series C Shares are issued in book entry only form and must be purchased or transferred through a participant in the CDS depository service (CDS Participant). All rights of holders of Series C Shares must be exercised through CDS or the CDS Participant through which the Series C Shares are held. The deadline for the registered shareholder to provide notice of exercise of the right to convert Series C Shares into Series D Shares is 3:00 p.m. (MST) / 5:00 p.m. (EST) on June 15, 2022. Any notices received after this deadline will not be valid. As such, holders of Series C Shares who wish to exercise their right to convert their shares should contact their broker or other intermediary for more information and it is recommended that this be done well in advance of the deadline in order to provide the broker or other intermediary with time to complete the necessary steps.
If TransAlta does not receive an election notice from a holder of Series C Shares during the time fixed therefor, then the Series C Shares shall be deemed not to have been converted (except in the case of an automatic conversion). Holders of the Series C Shares and the Series D Shares will have the opportunity to convert their shares again on June 30, 2027, and every five years thereafter as long as the shares remain outstanding.
The Toronto Stock Exchange (TSX) has conditionally approved the listing of the Series D Shares effective upon conversion. Listing of the Series D Shares is subject to TransAlta fulfilling all the listing requirements of the TSX.
About TransAlta Corporation:
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy-efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydroelectric power. For over 100 years, TransAlta has been a responsible operator and a proud community-member where its employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals.
For more information about TransAlta, visit our web site at transalta.com.
This news release contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as may, will, should, estimate, intend or other similar words). Specifically, this news release contains forward-looking information with respect to the Company, the Series C Shares and the Series D Shares, including but not limited to future conversions, redemptions and dividends. All forward-looking information reflect the Company’s beliefs and assumptions based on information available at the time the statements were made and as such are not guarantees of future performance. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this press release. TransAlta undertakes no obligation to update or revise any forward-looking information except as required by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from those in the forward-looking information, refer to the Company’s Annual Report and Management’s Discussion and Analysis, and the risks set out in the prospectus supplement dated November 23, 2011 relating to the issuance of the Series C Shares, filed under the Company’s profile on SEDAR at www.sedar.com and with the U.S. Securities and Exchange Commission at www.sec.gov.
