TransAlta to Acquire 310 MW Contracted Ontario Gas Portfolio for $95 Million

Executive Summary

• TransAlta announced a definitive share purchase agreement to acquire Far North Power Corp., adding 310 MW of natural‑gas generation capacity in Ontario.
• The transaction price is $95 million (≈$306 per kW) and is expected to be immediately accretive to free cash flow, contributing roughly $30 million of average Adjusted EBITDA per year.
• Closing is anticipated in early Q1 2026, subject to customary regulatory approvals.

Key Details

• Purchase Price: $95 million total; approximately $306 per kilowatt of capacity.
• Assets Acquired: Four natural‑gas‑fired generation facilities – Iroquois Falls (120 MW), Kingston (110 MW), North Bay (40 MW) and Kapuskasing (40 MW).
• Capacity Added: 310 MW, increasing TransAlta’s Ontario footprint to ~1,300 MW.
• Financing: Transaction will be funded with cash on hand and draws on existing credit facilities; no external financing disclosed.
• Accretion: Expected to be immediately accretive to free‑cash flow and cash yield upon closing.
• Adjusted EBITDA Impact: Projected addition of ~US$30 million average Adjusted EBITDA per year (based on 2027‑2031 outlook).
• Contractual Outlook: Approximately 68% of the portfolio’s gross margin is contracted through 2031; assets positioned for re‑contracting and merchant upside via TransAlta’s Energy Marketing & Trading team.
• Closing Conditions: Subject to customary closing conditions, including receipt of required regulatory approvals. Anticipated close in early Q1 2026.
• Strategic Rationale: Enhances TransAlta’s contracted generation portfolio in its core Ontario market, diversifies fuel mix, and supports long‑term growth amid electrification and population expansion.

Notable Quotes

“With this acquisition, our position in Ontario increases through contracted and complementary assets… The transaction adds to our reliable and increasingly diversified portfolio, and we see long term value in these assets,” – John Kousinioris, President & CEO, TransAlta.

“This acquisition is immediately accretive to cash flow and demonstrates progress towards our priority of pursuing strategic M&A,” – Joel Hunter, EVP Finance & CFO, TransAlta.