Brookfield Renewable Partners L.P. (TSX:BEP.UN) made a proposal to acquire the remaining 38.36% stake in TerraForm Power, Inc. (NasdaqGS:TERP) for $1.42 billion on January 11, 2020. Under the terms of consideration, Brookfield Renewable Partners agreed to issue 0.36 class A shares of Brookfield Renewable Corporation (BEPC) priced at the per unit price of Brookfield Renewable Partners (BEP) for each class A share of TerraForm not owned by Brookfield Renewable Partners or its affiliates. Brookfield Renewable Corporation is expected to be listed on TSX and NYSE and its shares are expected to be distributed by BEP at the price of BEP units. Any adjustment on change in price of listing of BEPC will be will be done by proportionate adjustment in exchange ratio. As of July 29, 2020, TERP stockholders have elected to receive, for each share of TERP Class A common stock held, either 0.47625 of a BEPC share or 0.47625 of a BEP unit. BEPC will issue 37.04 million shares and BEP will issue 1.04 million units as part of the transaction.

Brookfield Renewable Partners L.P. signed a definitive merger agreement to acquire the remaining 38.5% stake in TerraForm Power, Inc. on March 16, 2020. Under the terms of the agreement, each share of Class A common stock of TerraForm Power will be acquired for consideration equivalent to 0.381 of a Brookfield Renewable unit. For each share of TerraForm Power's Class A common stock held, TerraForm shareholders will be entitled to receive, at their election, either Class A shares of Brookfield Renewable Corporation or limited partnership units of Brookfield Renewable. As a result of the transaction, Brookfield Renewable Partners L.P. and its affiliates will increase their combined ownership in TerraForm from 61.5% to 100% stake. In case of termination by either party, BEP will receive a fee of $15 million from TerraForm.

The completion of the transaction is subject to definitive transaction documentation and customary approvals, including the approval of the independent committee and the approval of a majority of TerraForm's shareholders not affiliated with BEP, non-waivable approval of TerraForm shareholders representing a majority of the outstanding shares of TerraForm Class A common stock, approval for listing of the BEPC exchangeable shares and BEP units constituting the TERP acquisition consideration on the NYSE, conditional approval for listing of the BEPC exchangeable shares and the BEP units issuable as TERP acquisition consideration on the TSX, expiration or termination of the applicable waiting period under the HSR Act, receipt of the Competition Act approval and receipt of approval from FERC, declaration by the SEC of the effectiveness of the registration statement, receipt of an opinion regarding the reincorporation tax treatment, the 351 tax treatment, the 721 tax treatment and BEP non recognition tax treatment and customary closing conditions. The special committee of the Board of Directors at TerraForm Power comprised solely of non-executive and independent Directors of TerraForm Power, has unanimously recommended that TerraForm Power shareholders approve the transaction.

The Board of Directors of TerraForm (the “Board”), upon the unanimous recommendation of a Special Committee of the Board consisting of the non-executive, disinterested and Independent Directors of the Company (the “Special Committee”), and the Board of Directors of the general partner of BEP approved the Reorganization Agreement and the transactions contemplated thereby. As of May 27, 2020, Federal Trade Commission granted the early termination notice under the HSR Act. As of June 25, 2020, the annual meeting of TERP stockholders will be held on July 29, 2020 to approve the transaction and Glass, Lewis recommending that TerraForm Power stockholders vote FOR the merger. As of June 25, 2020, the conditions related to expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and clearance from the Canadian Competition Bureau have been satisfied. As of July 14, 2020, Institutional Shareholders Services Inc., issued a report recommending that TerraForm Power stockholders vote FOR the merger. As of July 29, 2020, TERP shareholders approved the transaction. The transaction is expected to close in the third quarter of 2020. The transaction is expected to be closed on July 31, 2020. The transaction is seen as immediately and long-term accretive by BEP.

BMO Capital Markets and The Bank of Nova Scotia acted as financial advisor to Brookfield Renewable Partners L.P. Richard Hall, David J. Perkins, Andrew W. Needham and Jonathan J. Katz of Cravath, Swaine & Moore LLP and Karrin Powys-Lybbe, Mile Kurta, Josh Lavine, Corrado Cardarelli, Scott Semer and David Mattingly of Torys LLP acted as legal advisors to Brookfield Renewable Partners. Morgan Stanley & Co. LLC and Greentech Capital Advisors acted as financial advisors and fairness opinion providers and Sean Thomas Wheeler, Debbie Yee, Andrew T. Calder, Brooksany Barrowes, Nicholas Gladd, Paul D. Tanaka, Jennifer Rainey Singh, David Wheat and William Dong of Kirkland & Ellis LLP and Srinivas M. Raju of Richard, Layton and Finger LLP acted as legal advisor to TerraForm Power. Jakob Rendtorff of Simpson Thacher & Bartlett LLP acted as legal advisor for Morgan Stanley. MacKenzie Partners, Inc. acted as the information agent to TerraForm. The fees of MacKenzie Partners, Inc. are expected to be $17,500 plus reimbursement of its reasonable out-of-pocket cost. Computershare Trust Company of Canada acted as the exchange agent for Brookfield Renewable as part of the transaction. TerraForm Power has agreed to pay Morgan Stanley a fee of $13 million for its services, $2 million of which became payable upon delivery of Morgan Stanley's opinion and $11 million of which is contingent upon the consummation of the TERP acquisition. Greentech has acted as a financial advisor to the Special Committee in connection with the TERP acquisition and will receive an advisory fee of $6 million contingent upon the consummation of the TERP acquisition (referred to as the Advisory Fee). Greentech received a fee of $1.5 million upon the delivery of its opinion that is not contingent upon consummation of the TERP acquisition. Opinion Fee is creditable against any Advisory Fee. Institutional Shareholders Services Inc. and Glass, Lewis & Co., LLC acted as transfer agent for TerraForm.

Brookfield Renewable Partners L.P. (TSX:BEP.UN) completed the acquisition of the remaining 38.36% stake in TerraForm Power, Inc on July 31, 2020.