Wind M&A Roundup, May 2018

Australia – PowerChina acquires 80% interest in the Cattle Hill Wind Farm in Tasmania

PowerChina Resources signs agreement to buy an 80% interest in the Cattle Hill Wind Farm in Tasmania. The seller of the stake is Chinese wind power developer Goldwind.

PowerChina Resources Ltd is making its first move into the Australian renewables market with the acquisition of an 80% stake in the Cattle Hill Wind Farm development project in Tasmania.

PowerChina Resources is the overseas investment arm of the Power Construction Corporation of China Ltd, one of China’s biggest multinationals.

The seller is another Chinese company, developer Goldwind Capital Australia, which will retain the remaining 20% stake in the project. Australian law firm Allens collaborated with Linklaters to advise on all aspects of the deal in Australia and China, including legal due diligence and transaction documents.

Cattle Hill Wind Farm is located on the eastern shore of Lake Echo, on the southern side of the Central Plateau of Tasmania. Approvals have been received from Council, State and Commonwealth Regulators for the construction and operation of wind turbine generators and associated infrastructure. The project will consist of 48 Goldwind turbines, producing up to 150MW of clean renewable electricity. The wind farm will be one of the largest in Tasmania once completed in late 2019.

The wind park will be connected to the power grid through TasNetworks’ Waddamana substation. The energy will be purchased by state government-owned electricity retailer Aurora Energy under a long-term contract.

Initial development of the project, including detailed site analysis, concept design, onsite wind monitoring, and submission of the Development Application and related Environmental Management Plan was undertaken by NP Power Pty Ltd. Goldwind acquired the project in September 2017.

Goldwind Australia is a wholly owned subsidiary of Xinjiang Goldwind Science & Technology, a leading vertically integrated global wind power company.

UK – Mainstream sells 450 MW wind farm to EDF Group

The EDF Group, via EDF Renewables in the United Kingdom, a joint subsidiary of EDF Energy and EDF Energies Nouvelles, has bought the Neart na Gaoithe wind farm project from global wind and solar developer Mainstream Renewable Power, following a competitive bidding process.

The wind farm will generate up to 450 megawatts (MW) of renewable energy, which is equivalent to the annual electricity provision of around 375,000 homes. It is a fully consented offshore wind project which is located in the Firth of Forth off the east coast of Scotland. It covers 105km2, and has a 15 year Contract for Difference at 140 Euros (corresponding to the indexation of the tariff of £114.39 that was set in 2012 prices), and grid connection agreements in place. This project also benefits from a wind regime among the best in the world.

Germany – E.on to acquire German renewable assets of Vortex Energy

German electric utility company E.ON’s subsidiary E.ON Climate & Renewables is acquiring German activities of the Kassel-based wind energy project company Vortex Energy Group.

Financial details about the transaction have not been disclosed. E.ON is taking over the company to increase its wind energy portfolio in the country. Vortex has been involved in the development, realization and operation of onshore wind farms in the country since 2004.

Presently, the company has a project pipeline of wind farms of about 300MW and large number of projects at an early stage of development. These are claimed to complement E.ON’s activities in construction and operation of wind farms in Germany.

E.ON Climate & Renewables CEO Anja-Isabel Dotzenrath said: “We see strong growth potential for wind energy in Germany. Vortex’s outstanding expertise and regional networking are a key factor for us to exploit this potential and compete for the best locations.”

After the acquisition, Vortex will continue its business from Kassel without any changes to its market presence. The acquisition will see transfer of 30 of its employees to E.ON. Vortex Energy Group’s Polish and Belgian activities will not be part of this transaction.

This transaction is subject to approval from relevant regulatory authorities.

UK – Aviva Investors Global Services to acquire 49% stake in Fred Olsen CBH Limited

Funds managed by Aviva Investors Global Services Ltd have agreed to buy from Fred Olsen Renewables AS a 49% stake in the firm that holds two Scottish wind farms totaling 75.3 MW.

Aviva Investors will pay a total of GBP 117.3 million (USD 160.5m/EUR 133.4m) in cash for the minority stake in Fred Olsen CBH Limited (FOCBH), which owns Crystal Rig III Limited (CRIII) and Brockloch Rig Windfarm Limited (BRW). The transaction implies an enterprise value for the target of GBP 239.4 million.

Meanwhile, the Fred Olsen unit that so far owned 100% of FOCBH is considering a secured facility agreement with banks of GBP 65 million. The involved wind farms benefit from receiving Renewables Obligation Certificates (ROC) for their first 20 years of operation. The final ROC cut off date for CRIII is November 2036, while for BRW it is March 2037.

The seller is Fred Olsen Renewables Limited (FORL), which has an agreement to buy back the 49% FOCBH stake for a nominal amount in 2042.

Fred Olsen Renewables AS is wholly-owned by Bonheur ASA (OSL:BON). The latter said that this transaction will have no direct impact on its consolidated income statement, but will affect the value of total assets. It will use the proceeds for potential renewable energy projects and other corporate purposes.

Ireland – Greencoat Renewables acquires 36 MW wind farm from Impax Asset Management

Irish energy group Greencoat Renewables has completed its acquisition of Dromadda More, a 36MW wind farm in Co Kerry for €88.4 million.

The company announced a move to acquire the facility late last year. It also said it has agreed a new €250 million revolving credit facility with five banks.

The acquisition takes Greencoat Renewables’ generation capacity to 194MW and total borrowings to 43 per cent of gross asset value.

The company, which raised €270 million when it floated in London and Dublin last year, said it is to buy from Impax Asset Management.

The farm consists of 11 Vestas V112 turbines. As a newly built asset, it will benefit from a full 15 years of REFIT-2 revenues, guaranteeing a minimum floor price for the electricity produced by the asset, Greencoat said.

Ireland – NTR acquires 28 MW wind farm

NTR has added a further 28MW to its onshore NTR Wind 1 LP fund portfolio, with the acquisition of Aeolus, a 28MW wind project located in County Mayo, Ireland.  Total costs for the project amount to just over €50 million.  The project was acquired from private project developers in the Irish market.

“This is the twelfth acquisition of onshore wind assets in Ireland and the United Kingdom by our NTR Wind 1 fund.  In just over three years, we have acquired 220MW, with over 160MW now constructed and producing clean energy” said NTR Chief Investment Officer, Manus O’Donnell.

Once operational, the project will comprise 12 turbines and will provide enough clean energy to power 19,000 homes.

Ireland – Innogy acquires 50% stake in 600 MW Dublin Array offshore wind project from Saorgus Energy

Innogy has taken a 50% stake in the proposed up to 600MW Dublin Array offshore wind farm off the east coast of Ireland.

The German utility has struck a strategic partnership with local outfit Saorgus Energy to develop the Irish Sea site through planning consent.

Innogy will lead the next phase of development, it said.

Chief operating officer Hans Bunting said the deal is a “perfect fit” with the company’s investment strategy.

The up to 145-turbine wind farm is planned in an area 10km of the coast of Dublin and Wicklow on the Kish and Bray banks.

Dublin is mulling a new renewables support mechanism that is due to be finalised shortly and could open a route to market for offshore wind.