Montalva Project Spinout / How to MonetizeSpinning out the Puerto Rico solar project is identified as an option in the NR. But I don't know if GRB will actually build and operate the solar plant. Montalva will produce a NPV return of US$191m which is a tidy a nice profit for anyone. In lieu of building and operating it however, they could sell it as a turn key project to another co. that is already in the business of operating solar plants. This way that co. could take advantage of scale and expertise, expand its operations and increase the bottom line of this project. We shareholders won't get $US191m but we'd get a profit that I think would be much greater than our current market cap.
23m shares FD x $1.05 = C$24m FD Cap/1.30 = US$18.5m. In other words our market cap is selling for 1/10 of the NPV of the solar project alone.
So as long as selling the project outright is on the table, does it make sense to set up a new company just to wind it down in a year or so? Or you do spin it out and have bidders buy out the separate company? I don't know. All I know is that the valuation of GRB is 1/10 of the NPV of the Montalva!
So how do we get from here to sale of Montalva or a GRB build and operate decision?
1. Positive federalization of PREPA decision by US Congress
2. Go ahead provided by PREPA to GRB to proceed
3. Assemble all the construction plans, permits, land assembly documents, purchase orders for major components, and proforma statements for review and formal sign off by the two banks that have already stepped forward with their formal intents.
4. Sign off by the banks.
5. Sell the project to a third party operator or buildi the project ourselves.
6. GRB shareholders party!