"We are proud that Ormat, the industry leader in geothermal development, recognized our company's value and have confidence in their ability to successfully develop the US Geothermal asset base," said Doug Glaspey, CEO of US Geothermal.
The agreement has been unanimously approved by both companies. The closing of the merger is subject to customary conditions, including receipt of regulatory approvals and approval by persons holding a majority of the outstanding shares of US Geothermal common stock. The transaction is expected to close in the second quarter of 2018.
Certain funds advised by JCP Investment Management, LLC, which own approximately 15 percent of the outstanding shares of US Geothermal, as well as the directors and officers of US Geothermal have entered into an agreement to vote in favor of the transaction.
U.S. Geothermal is currently operating geothermal power projects at Neal Hot Springs, Oregon, San Emidio, Nevada and Raft River, Idaho for a total designed net output of 45MW that currently generate approximately 38MW net. In addition, U.S. Geothermal is developing additional projects at the Geysers, California; a second phase project at San Emidio, Nevada; at Crescent Valley, Nevada; and the El Ceibillo project located near Guatemala City, Guatemala.
The operating assets are selling power under existing power purchase agreements with an aggregated contract capacity of 55MW.
"US Geothermal has developed a high-quality portfolio of geothermal assets," said Isaac Angel, CEO of Ormat Technologies. "As part of Ormat, we will leverage our core capabilities to help improve generation and enhance efficiency of these assets while also working to advance expansion opportunities."