What happened
Brookfield Renewable(NYSE: BEP)(NYSE: BEPC) stock has entered August on a somber note. While units of the partnership were trading 4.4% lower as of 11 a.m. ET Wednesday, shares of the corporate entity were down 3.8%.
The renewable energy giant has come under a probe, but it's not what you think. In fact, today's move in Brookfield Renewable stock serves as a great reminder of why you should read beyond the headlines and not panic if a stock's falling.
So what
In October last year, Brookfield Renewable formed a partnership with uranium giant Cameco to acquire Westinghouse Electric, one of the world's largest nuclear services companies. Westinghouse serves almost half of the global nuclear power generation sector and derives almost 85% of its revenue under long-term contracts.
Brookfield Renewable is pursuing the $7.9 billion deal through an energy-focused private equity fund called Brookfield Global Transition Fund I. At the time of the announcement, Brookfield Renewable said it expects to invest roughly $750 million for a 17% stake in Westinghouse. Together with its institutional partners though, Brookfield Renewable will own a 51% stake in Westinghouse while Cameco will own the remaining 49%.
This morning, Reuters reported that Britain's competition regulator is now probing Brookfield Renewable and Cameco and has "invited comments" about the deal from the companies.
Now what
The prospect of the acquisition running through regulatory hurdles or even falling through has spooked investors, but it's too early to jump to conclusions. In fact, Reuters quoted Cameco as saying that this probe was just a "part of the standard regulatory approval process for transactions of this nature."
Deal or not, Brookfield Renewable is a great dividend stock with firm plans to grow its earnings and cash flows, and I'd even consider any drop in the stock price a buying opportunity right now.
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Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Brookfield Renewable. The Motley Fool recommends Brookfield Renewable Partners. The Motley Fool has a disclosure policy.