Hedge fund Starboard asks Algonquin Power to sell renewable assets
July 6 (Reuters) - Activist hedge fund Starboard Value on Thursday sent a letter to utility firm Algonquin Power & Utilities asking it to sell a majority of its renewable assets to reduce debt and improve earnings.
Starboard, with a 7.5% stake, is the largest shareholder in Algonquin which is grappling with a $7.5 billion debt burden following a series of acquisitions in recent years.
Algonquin said in May it would launch a review of its renewable energy group, following a push by Corvex Management and other activist firms for changes.
"We believe the remaining regulated utility business, once the unregulated business is sold, should be highly attractive to public market investors," Starboard said in the letter on Thursday.
The renewable assets that the hedge fund urged to divest include Algonquin's 42% stake in Atlantica Sustainable Infrastructure.
Algonquin, whose shares fell 1.6% to C$10.94 on Thursday, did not immediately respond to a request for comment. (Reporting by Sourasis Bose in Bengaluru; Editing by Shounak Dasgupta)
