RE: RE: Selective hearing I disagree with you Peter.
1. Buyers are looking for a 20+ year rate. A 5 yr. return is not the standard for prospective buyers.
2. The buyer of this company is not going to pay a penny extra now for the possibility of expansion. Blue Sky if a reason to buy but not a reason to increase the purchase price in these kinds of deal. "Potential" is the bonus that the current owner gives up when it sells.
3. The projects under development are worth peanuts, which is why Jeff wants Yabucoa to go to financial close, making it a real project with a predictable cash flow.
4. An EBITDA multiple is not necessaroly the valuation that an acquiror would use, although they'd want to acquire at a multiple that is lower than their own stock's multiple. If it is private equity (a Strategic buyer) they are not interested in an EBITDA multiple as much as a rate of return, which is slightly different. And to say that 10 is appropriate, you must show that this the value of similar companies on the market, or the EBITDA multiple at which there were recent acquisitions of renewable energy projects. Do you have comparables? 10 times EBITDA guidance for WND may not be a great price after you deduct the debt. Did you do that?
The assets that have significant value are the EBITDA from the currently operating projects, Yabucoa and the tax benefits. How they are valued will differ depending on the company who is doing it.