LONDON: The Board of the Renewables Infrastructure Group (TRIG) has exchanged contracts to acquire a c.36% equity interest in Merkur Offshore, a 396MW operational offshore wind farm located in the German North Sea.

TRIG has partnered for the acquisition with the Dutch pension investor APG, who will acquire the remaining 64% in the Project.

At, or shortly after the completion of the transaction (expected in H1 2020), which is subject to lender consent and competition clearance, TRIG intends to sell-down a share to minority co-investors managed by InfraRed, leaving TRIG with an approximate 25% equity interest in the Project. This is consistent with TRIG’s strategy of partnering with aligned co-investors on larger transactions. Once completed, this investment is expected to represent approximately 8% of TRIG’s portfolio value.

The Project comprises 66 GE Haliade-150 6MW offshore wind turbines and GE Renewable Energy provides Operations & Maintenance (O&M) services under a 10-year contract.

Commercial operations commenced in June 2019 and the Project benefits from an attractive Feed-in-Tariff for the next 13.5 years (until June 2033), followed by a floor price for a further 6 years. The existing debt financing in the Project is fixed rate and fully amortising within the initial subsidy period.

The investment is being acquired from a consortium of Partners Group (on behalf of its clients), DEME Concessions, GE Energy Financial Services, ADEME and a private fund separately managed by InfraRed. Due to one of the vendors being a fund managed by InfraRed, TRIG’s Investment Manager, the transaction process included the procedures set out in the Company’s investment policy and recent prospectuses, these include the conduct of independent due diligence by a specially constituted buy-side committee and an independent third-party valuation and approval by TRIG’s Board of Directors, all of whom are independent of the Investment Manager.

TRIG’s investment will be financed from a combination of the proceeds of its recent capital raising and a drawdown from the Group’s revolving acquisition facility.

Helen Mahy CBE, Chairman of TRIG, said: “The Board of TRIG is delighted to announce the Company’s third offshore wind investment and our second investment in Germany. We are pleased to be growing our presence in the European offshore wind market which is making an increasingly important contribution to the decarbonisation of energy usage.”

Richard Crawford, of InfraRed Capital Partners, said: “We welcome this opportunity to become co-investors alongside APG, a highly respected investor with a strong track record. Building effective relationships with developers, partners and asset managers remains essential for TRIG’s ability to access these attractive larger transactions.”

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