the proposals and to expedite improvements to ASU 2014-09. The adoption of ASU 2016-20 is effective from the periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company evaluated the standard and determined that it did not have a material effect on its consolidated financial statements.
In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The amendment seeks to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting, including acquisitions, disposals, goodwill and consolidation. The adoption of ASU 2017-01 is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. The amendments should be applied prospectively on or after the effective dates. The Company is evaluating the effect of this standard on its consolidated financial statements.
In January 2017, the FASB issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the FASB eliminated Step 2 from the goodwill impairment test. Under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The standard will be applied prospectively and is effective for annual and interim impairment tests performed in periods beginning after December 15, 2019. The Company is evaluating the effect of this standard on its consolidated financial statements.
In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. The amendment clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. The new guidance is expected to reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as modifications. Changes that do not impact the award’s fair value, vesting conditions, or classification as an equity or liability instrument will not to be assessed modification accounting. The guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. The Company is evaluating the effect of this standard on its consolidated financial statements.
In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The objective of the amendment is to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. In addition to that main objective, the amendments make certain targeted improvements to simplify the application of the hedge accounting guidance in current U.S. GAAP based on the feedback received from preparers, auditors, users, and other stakeholders. The guidance is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018. The Company is evaluating the effect of this standard on its consolidated financial statements.
2017 Pending Acquisition
Acquisition of BioTherm
In April 2015, the Company entered into purchase and sale agreements to acquire a controlling interest in three operating power plants located in South Africa with an aggregate net capacity of 32.6 MW from BTSA Netherlands Coöperatie U.A. (“BioTherm”). The aggregate consideration payable for the controlling interests in these three power plants is approximately $75.1 million in cash, comprised of approximately $67.6 million and ZAR 100.4 million ($7.4 million as of September 30, 2017), plus 544,055 shares of the Company’s Class A common stock, which is fixed in accordance with the purchase and sale agreements. Additionally, a variable amount, which is estimated to be approximately $3.5 million , is due upon the completion of the transaction (the “Variable Amount”). The Variable Amount mainly represents customary working capital adjustments that have occurred between the date the Company entered into the purchase and sale agreements and the date that the transaction is completed. The aggregate consideration includes amounts for certain additional rights and services. No further consents are required with respect to the completion of the acquisition of the Klipheuwel wind power plant. However, the completion of the acquisition of the Aries and Konkoonsies solar power plants remains subject to obtaining consents from project lenders. The completion of the BioTherm transaction is expected to occur in the fourth quarter of 2017.