TIDMNESF
RNS Number : 1614V
NextEnergy Solar Fund Limited
01 November 2017
1 November 2017
NextEnergy Solar Fund Limited ("NESF" or the "Company")
Acquisition of a portfolio of eight operating solar plants with
an installed capacity of 34.5MWp located in Italy
-- Share purchase agreement signed to acquire a portfolio of
eight operating solar plants ("Portfolio") totalling 34.5MWp
located in Italy for a total value (equity and debt) of EUR131.9M
(GBP116.2M*)
-- Five plants located in Puglia region and three plants located
in Campania region of Italy
-- All eight plants completed construction and were connected to
grid between 2010 and 2011 and therefore boast a significant
operating history
-- Long-term non-recourse project finance debt financings with
an outstanding notional of EUR76.9M and fully amortising structure
as well as fixed interest rates to maturity in place
-- At closing NESF intends to put in a place a EUR/GBP foreign
currency hedging structure covering future cash flows generated by
the Portfolio to eliminate currency fluctuation exposure on
returns
-- Assessment and acquisition of portfolio and on-going
management of plants facilitated by NextEnergy Capital's (NESF's
Investment Advisor) long-standing presence and expertise in
Italy
-- Completion of acquisition subject to change-of-control
approvals by the Portfolio's debt financing providers
-- NESF has now secured 58 assets totalling 539MWp with a total
investment value of GBP700.5M (excluding four development
projects)
NESF is pleased to announce the signing of a share purchase
agreement covering a portfolio of eight operating plants for a
total of 34.5MWp located in Italy. Five of the acquired plants are
in the region of Puglia (total 21.5MWp) and three are in the region
of Campania (total 13.0MWp).
The equity value of the acquisition amounts to EUR55.0M
(GBP48.5M*). The Portfolio's total outstanding long-term
non-recourse debt facilities amount to EUR76.9M (GBP67.8M*). The
total Portfolio value of GBP116.2M* amounts to approximately 12% of
the Company's GAV of GBP929.1M as at 30 June 2017 adjusted for the
Portfolio acquisition; the Company has a limit of 15% of GAV for
OECD investments outside the UK. The acquisition will be financed
with the Company's available financial resources.
All eight plants were grid-connected between 2010 and 2011 and
benefit from the Italian feed-in-tariff ("FIT") regime, with FITs
ranging from EUR195/MWh to EUR318/MWh. The Portfolio's FIT revenues
account for approximately 84% of total expected revenues in 2018,
with the remaining 16% deriving from the sale of electricity into
the Italian energy market. The Portfolio's FIT expires in 2031,
after which the Portfolio will continue to receive revenues from
the sale of electricity generated at market prices.
The Company believes that the Portfolio's extensive operating
history and significant on-going cash flow generation represents an
attractive aspect of the acquisition and further mitigates
operating and financial risks associated with the usual acquisition
of solar power portfolios. In addition, the return profile of the
acquisition is superior to returns on the existing asset portfolio
and is therefore expected to be accretive to the Company's overall
returns.
The portfolio assets have been financed with non-recourse fully
amortising project financing debt transactions provided by a major
Italian bank and a major European bank. The Italian bank provided
one project financing covering four projects and the European bank
provided a separate project financing covering the other four
projects. The Italian bank's project financing matures in June
2029. The European bank's project financing matures in June 2030.
Interest rate hedges in place cover between 75% and 95% of the
outstanding principal of both project financings until maturity.
The Company will release the names of the banks upon receiving
their consent to do so as per the financing contracts in place.
The Company's Investment Manager, Investment Advisor and their
affiliated entities ("NEC Group") have long-standing experience in
the development, construction, financing and asset management of
solar plants in Italy. NEC Group has had a presence in Italy since
2007, with currently some 50 team members in its Milan and other
regional offices and has over the course of its activities managed
and/or monitored approximately 1,300 individual utility-scale solar
power plants in Italy on behalf of equity owners and debt
financiers. NEC Group's expertise in Italy was key in identifying
the Portfolio, assessing its quality and in the acquisition
process, and is further expected to facilitate the asset management
of the Portfolio going forward.
Kevin Lyon, Chairman of NESF, commented:
"Following the expansion of the Company's investment policy to
include OECD investments outside the UK, we are pleased to announce
our first international acquisition in a market in which our
Investment Advisor has demonstrable long-standing expertise. Their
experience and local presence in Italy will be invaluable in
managing the portfolio going forward.
This acquisition diversifies our market risk, while reducing the
overall exposure to brown power prices across our asset base. In
addition, implementing the foreign exchange hedge limits the effect
of any currency fluctuations on the returns this Portfolio will
generate for us.
All in all, this Portfolio is a very attractive addition to our
Company. In parallel, the team continues its work on acquiring
further solar assets in the UK at attractive values and I expect
further announcements in the near future."
NESF's Investment Adviser will host a conference call for
analysts at 13:00 hours (GMT) today. Please contact MHP
Communications on 020 3128 8100 or nextenergy@mhpc.com for more
details.
Notes
* Assuming a GBP/EUR exchange rate of 1.1349 as at 31 October
2017
For further information:
NextEnergy Capital Limited 020 3239 9054
Michael Bonte-Friedheim
Aldo Beolchini
Cantor Fitzgerald Europe 020 7894 7667
Sue Inglis
Fidante Capital 020 7832 0900
Robert Peel
Justin Zawoda-Martin
Shore Capital 020 7408 4090
Anita Ghanekar
Macquarie Capital (Europe)
Limited 020 3037 2000
Nick Stamp
MHP Communications 020 3128 8100
Andrew Leach
Notes to Editors:
NextEnergy Solar Fund (NESF)
NESF is a specialist investment company that invests primarily
in operating solar power plants in the UK. It is able to invest up
to 15% of its Gross Asset Value in operating solar power plants in
OECD countries outside the UK. The Company's objective is to secure
attractive shareholder returns through RPI-linked dividends and
long-term capital growth. The Company achieves this by acquiring
solar power plants on agricultural, industrial and commercial
sites.
NESF has raised equity proceeds of GBP591.9m since its initial
public offering on the main market of the London Stock Exchange in
April 2014. It also has credit facilities of GBP226m in place
(GBP150m from a syndicate including MIDIS, NAB and CBA; MIDIS:
GBP54.3m and NIBC: GBP21.7m).
NESF is differentiated by its access to NextEnergy Capital Group
(NEC Group), its Investment Manager, which has a strong track
record in sourcing, acquiring and managing operating solar assets.
WiseEnergy is NEC Group's specialist operating asset management
division and over the course of its activities has been providing
solar asset management, monitoring and other services to over 1,300
utility-scale solar power plants with an installed capacity in
excess of 1.9 GW since its inception.
Further information on NESF, NEC Group and WiseEnergy is
available at www.nextenergysolarfund.com, www.nextenergycapital.com
and www.wise-energy.eu.
This information is provided by RNS
The company news service from the London Stock Exchange
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