Algonquin conversion a plus

Article Excerpt

ALGONQUIN POWER & UTILITIES CORP. $3.33 (Toronto symbol AQN; Shares outstanding: 85.7 million; Market cap: $285.2 million; SI Rating: Extra Risk) is the new name of Algonquin Power Income Fund after its conversion to a dividend-paying corporation. To effect the conversion, TSX-listed Hydrogenics Inc. bought Algonquin, then changed its name to Algonquin Power & Utilities Corp. That lets Algonquin benefit from $192 million in tax losses held by Hydrogenics. Algonquin will use these to defer income taxes to as late as 2015. Algonquin’s monthly distribution remains unchanged, at $0.02 a share, but is now classified as a dividend. The shares yield 7.2%. Algonquin Power holds interests in 42 renewable-power facilities in Canada and the northeastern U.S., 13 thermal-energy plants and 18 water-distribution and waste-water facilities. These include a partnership with Emera Inc. (Toronto symbol EMA), which is a recommendation of The Successful Investor, our affiliated publication. Emera holds 9.9% of Algonquin. Algonquin Power is still a buy. buy…

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