Drax completes acquisition of ONCAP-backed Pinnacle

Pinnacle Renewable Energy, a Vancouver-based producer of industrial wood pellets, has completed its sale to an affiliate of Britain's Drax Group.

Pinnacle Renewable Energy, a Vancouver-based producer of industrial wood pellets, has completed its sale to an affiliate of Britain’s Drax Group. The previously announced cash transaction is valued at C$831 million, including net debt. Pinnacle was backed by ONCAP, the mid-market platform of Onex Corp, a Canadian private equity firm.

PRESS RELEASE

VANCOUVER, BC, April 13, 2021 /CNW/ – Pinnacle Renewable Energy Inc. (“Pinnacle” or the “Company”) (TSX: PL) today announced the completion of the previously announced plan of arrangement under the Business Corporations Act (British Columbia), pursuant to which Drax Group plc (“Drax”) (LSE: DRX) through its wholly-owned subsidiary, Drax Canadian Holdings Inc., has acquired all of the issued and outstanding common shares (“Shares”) of the Company for C$11.30 in cash per Share (the “Arrangement”).

As a result of the Arrangement, Pinnacle has become an indirect wholly-owned subsidiary of Drax and the Shares are anticipated to be de-listed from the Toronto Stock Exchange on or about April 15, 2021. The Company will also submit an application to cease to be a reporting issuer under applicable Canadian securities laws and to otherwise terminate the Company’s public reporting requirements.

ABOUT PINNACLE
Pinnacle is the second largest producer of industrial wood pellets in the world. The Company’s products are used to displace fossil fuels in the production of baseload electrical power in key markets around the world. The Company operates nine production facilities in Western Canada and one in Alabama, with one additional facility under construction in Alabama and more in development. The Company also owns a port terminal in Prince Rupert, BC. Pinnacle has entered into long-term, take-or-pay contracts with utilities in the U.K., Europe and Asia that represent an average of 99% of its production capacity through 2026.