US-based Ormat Technologies has signed a definitive agreement to acquire Idaho-based US Geothermal for a total consideration of approximately $110m.
Under the deal, US Geothermal common stockholders will receive $5.45 per share in cash.
Completion of the transaction is expected in Q2 of this year and is subject to customary conditions.
US Geothermal currently operates projects in Neal Hot Springs, Oregon; San Emidio, Nevada; and Raft River, Idaho. They are designed to generate a net output of 45MW but are currently producing 38MW.
In addition, the Idaho-based company is developing new projects at Geysers, California; Crescent Valley, Nevada; and Guatemala City, Guatemala, as well as developing a second-phase project at San Emidio, Nevada.
Ormat intends to improve the profitability of US Geothermal’s projects by nearly 50% by next year.
Ormat Technologies CEO Isaac Angel said: “This acquisition significantly broadens and diversifies our operations in the US, expanding our presence into Idaho and Oregon and giving us additional opportunities as we evaluate US Geothermal’s development pipeline.
“We are confident we can leverage our unique core capabilities to improve generation and efficiency at the existing plants, utilising our expertise and proprietary technology.
“Finally, we have identified operational and financial synergies, efficiencies and cost reductions, based on US Geothermal’s current revenue level, enabling us to improve the profitability of these operations.”