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Financial crisis stymies wind farm backers

The financial crisis is causing problems for First Wind, one of the backers of Deepwater Wind, the firm chosen by Gov. Donald L. Carcieri to build Rhode Island's offshore wind farm. ...First Wind declined to comment, but in its public filing the company warned: "If we are unable to obtain additional debt or equity financing, we may have to curtail our development activities or be forced to sell assets."

The financial crisis is causing problems for First Wind, one of the backers of Deepwater Wind, the firm chosen by Gov. Donald L. Carcieri to build Rhode Island's offshore wind farm.

In July, the Newton, Mass.-based wind-farm developer filed to do an initial public offering (IPO) of stock on the Nasdaq Stock Market, but the company has been unable to do so because "the market for IPOs ... has virtually shut down," USA Today reported today.

First Wind was hoping to raise $450 million to pay off its investors and fund future projects, the paper said. The company said its total expenditures increased to $40.3 million in 2007 from $22.9 million in 2006, the report said.

First Wind declined to comment, but in its public filing the company warned: "If we are unable to obtain additional debt or equity financing, we may have to curtail our development activities or be forced to sell assets."

The company has not announced plans to cancel its stock offering. But 86 other IPOs have been canceled this year, according to USA Today, which said the number of IPOs this year was the smallest since 1977. "This is unprecedented," Mark Heesen, president of the National Venture Capital Association, told the paper.

First Wind is not... more [truncated due to possible copyright]  

The financial crisis is causing problems for First Wind, one of the backers of Deepwater Wind, the firm chosen by Gov. Donald L. Carcieri to build Rhode Island's offshore wind farm.

In July, the Newton, Mass.-based wind-farm developer filed to do an initial public offering (IPO) of stock on the Nasdaq Stock Market, but the company has been unable to do so because "the market for IPOs ... has virtually shut down," USA Today reported today.

First Wind was hoping to raise $450 million to pay off its investors and fund future projects, the paper said. The company said its total expenditures increased to $40.3 million in 2007 from $22.9 million in 2006, the report said.

First Wind declined to comment, but in its public filing the company warned: "If we are unable to obtain additional debt or equity financing, we may have to curtail our development activities or be forced to sell assets."

The company has not announced plans to cancel its stock offering. But 86 other IPOs have been canceled this year, according to USA Today, which said the number of IPOs this year was the smallest since 1977. "This is unprecedented," Mark Heesen, president of the National Venture Capital Association, told the paper.

First Wind is not the only one of Deepwater's backers to run into financial problems this year.

On Sept. 2, Ospraie Management LLC announced that it would shut down its main hedge fund, which traded in commodities, after it lost nearly 40 percent of its value through the end of August.

Ospraie's Special Opportunities Fund - which was started by Ospraie and one of its chief investors, Credit Suisse, to invest in new companies - is also backing Deepwater Wind. That fund had $1.2 billion at the end of August, according to Fortune magazine.

State officials have said the financial crisis will not affect the wind farm proposal, which the governor has said is one of his top priorities.

Officials say they are ironing out the details of their agreement with Deepwater to build the wind farm off Rhode Island, and hope to finalize it by the end of this month. Deepwater is also searching for a new CEO after its former chief executive, Chris Brown, abruptly left the company last month. 

Deepwater Wind is a wind-energy firm - backed by energy developer First Wind (formerly UPC Wind) of Newton, Mass., and New York investors D.E. Shaw & Co. LP and Ospraie Management LLC - that has acquired the offshore wind projects of Long Island-based Winergy Power LLC. Founded in the spring of 2008, Deepwater has its headquarters in Ann Arbor, Mich., and offices in Houston, New Jersey and New York. For more information, visit www.DWWind.com.


Source: http://www.pbn.com/stories/...

DEC 24 2008
https://www.windaction.org/posts/18384-financial-crisis-stymies-wind-farm-backers
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