First Wind Files For IPO

First Wind, the recently renamed UPC Wind, has filed for an initial public offering. First Wind's current shareholders, which include management, DE Shaw and Madison Dearborn, want to raise $450 million from the IPO, for which JPMorgan and Goldman Sachs are underwriters. They want to use the proceeds to pay down its corporate revolving credit, turbine supply loan, and fund additional development activity.

First Wind currently has 92MW of capacity in operation, and 182MW of wind capacity under construction. Operational projects are located in Hawaii (30MW), Maine (42MW) and New York (20MW). It also has 720 MW at advanced development stage, 663MW at intermediate stage and 3,907MW at early stage planning. It has accumulated $132 million in losses since inception, according to its S-1 filing, completed a $143.6 million tax equity financing in 2007, and a $208 million tax equity financing in January 2008.

First Wind also disclosed that it has experienced difficulties with the Clipper turbines that is uses (along with GE equipment) at the majority of its projects, and that it has a $20 million mark-to-market liability under an oil-related swap for its Hawaii project. It lists $348 million in turbine supply debt, which has a 4.56% interest rate, and $248 million in other debt, primarily revolving credit debt, with an interest rate of 3.28%, as of June 2008. Of this debt, $350 million carries guarantees from shareholders.

First Wind says that it plans to refinance turbine debt and revolving credit debt on its projects at completion with a mixture of term debt and equity. It says that $314 million of its total debt matures before the end of March 2009. Its most expensive, but by far its longest-dated debt is the $24.7 million in 14-year debt for the Mars Hill project, for which, like all UPC's debt, HSH-Nordbank is the arranger.