Aquila European Renewables Income The Rock Bond Refinancing (8621L)
15 September 2021 - 07:21PM
UK Regulatory
TIDMAERS TIDMAERI
RNS Number : 8621L
Aquila European Renewables Income
15 September 2021
15 September 2021
Aquila European Renewables Income Fund plc - The Rock Bond
Refinancing
Bond refinancing includes EUR 235 million US Private Placement
& EUR 80 million Junior Nordic Green Bond
Aquila European Renewables Income Fund plc ("AERIF" or "the
Company"), the London-listed investment company advised by Aquila
Capital Investmentgesellschaft mbH, today announces that The Rock
(the "Project", also known as "Øyfjellet Wind Farm"), a project in
which the Company's wholly owned subsidiary holds a 13.7% interest,
successfully closed a US Private Placement ("USPP") and Junior
Nordic Green Bond ("Green Bond") (collectively the "Bond
Refinancing").
The Bond Refinancing comprises a USPP of EUR 235 million and a
Green Bond of EUR 80 million, representing a combined issuance
amount of EUR 315 million (on a 100% interest basis). The USPP
notes are rated investment grade and both bond issuances were
oversubscribed.
On 10 June 2021, the Company announced it had increased its
commitment to The Rock by up to EUR 35.6 million to provide bridge
financing (the "Bridge") for the Project given that certain
conditions under the Project's existing debt financing agreement
prevented the draw-down of the senior debt in place (approximately
EUR 323 million in total facility limits[1]). The proposed Bond
Refinancing was pursued in order to allow the Project to
immediately benefit from access to debt financing at attractive
terms. The Bond Refinancing is expected to be accretive to the
economic returns of the Project.
Proceeds from the Bond Refinancing will be used to fund
remaining construction and other project costs, repay the Bridge
provided by each of the Project shareholders and return surplus
capital to the Project's shareholders. In connection with the Bond
Refinancing, the Company (via its wholly owned subsidiary) expects
to receive total proceeds of approximately EUR 23 million,
comprising:
-- Approximately EUR 19 million, representing the full repayment
of the Bridge (principal drawn to date, plus accrued interest).
Funds are expected to be received shortly; and
-- Approximately EUR 4 million in surplus capital, which is
expected to be paid over time during the remainder of the
construction period.
Together with the Company's recently announced capital raising,
proceeds from the Bond Refinancing will be used to repay any
outstanding debt under its revolving credit facility (currently
drawn to EUR 10 million), as well as funding the Company's
attractive pipeline of investment opportunities.
The USPP has a tenor of 24 years and is fully amortising with a
fixed rate of 2.12%, whilst the Green Bond is a bullet facility
with a tenor of 5 years at a fixed rate of 2.75%. The Project is
also expected to enter into long-dated forward interest rate swaps
to mitigate future interest rate risks associated with the Green
Bond. The USPP represents an extension of tenor by approximately 6
years compared to the existing bank debt in place at the
Project.
The Green Bond was rated by the independent consultant CICERO
Shades of Green ("CICERO"). The Company is pleased to announce that
the Green Bond achieved a "Dark Green" rating and an "Excellent"
rating for governance, both of which are the highest possible
ratings under CICERO's framework. The favourable ratings reflect
the Project's focus on best practice including Environmental Impact
Assessments and transparent engagement with local stakeholders. A
link to CICERO's report is available on the Company's website.
Ian Nolan, Chairman of the Company, commented: "We are pleased
to announce the first debt capital markets issuance for AERIF via
its investment in The Rock. In addition to the economic benefits
associated with the refinancing, we are happy to have launched the
Company's first green bond, further augmenting our participation in
the green energy transition."
Commenting on today's announcement, Michael Anderson, Senior
Manager at Aquila Capital, the investment adviser to AERIF said:
"This is an important milestone for The Rock, the Aquila European
Renewables Income Fund and Aquila Capital as the project advances
closer toward completion. The refinancing was concluded at
attractive terms and further diversifies the Company's sources of
debt funding. We are very happy to see the transaction supported by
such a high quality investor base."
Ends
For further details contact:
Media contacts:
Smithfield Consultants
Ged Brumby | 020 3047 2527
John Kiely | 020 3047 2538
Andrew McLagan | 020 3047 2006
Sponsor, Broker and Placing Agent
Numis Securities 020 7260 1000
Tod Davis
David Benda
Vicki Paine
NOTES
Aquila European Renewables Income Fund plc ("AERIF" or the
"Company") is a London-listed renewable energy infrastructure
investment company with the aim to provide investors with an
attractive long-term, income-based return in EUR through a
diversified portfolio of hydropower, onshore wind and solar PV
investments across continental Europe and Ireland. Through the
diversification of generation technologies, the seasonal production
patterns of these asset types complete each other to balance the
cash flow, while the geographic diversification serves to reduce
exposure to one single energy market. AERIF is targeting 5.0 cents
per ordinary share in relation to the financial year ending 31
December 2021, with the aim of increasing this dividend
progressively over the medium term.
Further details can be found on AERIFs website at
www.aquila-european-renewables-income-fund.com .
[1] Includes EUR 260 million of long-term debt, which remains
undrawn, as well as other project debt facilities
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