After a failed attempt at a friendly deal with renewable power producer Canadian Hydro Developers, TransAlta Corp. says it is taking its $654-million all-cash hostile takeover offer directly to the target company’s shareholders.

With 143.7 million shares outstanding, the $4.55 per share bid, announced yesterday, values Canadian Hydro at $654 million. However, Trans­Alta said including debt and other financial measures, the enterprise value of the bid is $1.5 billion.

TransAlta, a Calgary-based utility, said it approached Canadian Hydro’s board in December with a written offer, but was told the hydro, wind and biomass company preferred to be independent.

TransAlta said the offer is a premium of about 30 per cent to the average trading price of Canadian Hydro Developers common shares.

TransAlta, which mainly operates coal- and natural gas-fired power plants, wants to expand into renewable energy sources as environmental regulations become more stringent.

Canadian Hydro Developers operates 694 megawatts of wind, hydro and biomass power plants in Alberta, Ontario, Quebec and British Columbia.

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