FRANKFURT: The Board of The Renewables Infrastructure Group (TRIG) has announced that the Company has exchanged contracts to acquire a 25% indirect equity interest in Gode Wind 1, a 330MW offshore wind farm, located in the German North Sea.[the_ad id=”31605″]The project has established a strong track record since operations commenced in February 2017 and benefits from an attractive Feed-In Tariff. Following the completion of the transaction, Gode Wind 1 would represent approximately 8% of the portfolio. The Transaction is consistent with TRIG’s strategy of investing in countries with stable renewable energy frameworks and in long-term income-producing projects within a diversified portfolio.
The Project was developed and constructed by Ørsted who will continue to own 50% of the equity in the Project and also provide Operations & Maintenance (O&M) services under a 20 year contract.
The Project is comprised of 55 Siemens Gamesa 6MW turbines. It is supported by a Feed-in-Tariff until November 2027, followed by a floor price for a further 10 years. The investment is being acquired from Global Infrastructure Partners (“GIP”) as part of their divestment of their 50% stake in the underlying project. The investment will be held alongside funds managed by a leading institutional fund manager. The holding company that the investment is made in has bond financing in place at a fixed rate of interest and fully amortising within the initial subsidy period, consistent with TRIG’s approach to the term financing of its Projects. The underlying wind farm has no additional leverage.
TRIG’s investment, which is subject to lender consent and competition clearance, will be financed from a combination of the proceeds of its recent fund raise and a drawdown of the Group’s revolving acquisition facility.
On completion, the non-UK share of TRIG’s portfolio will be approximately 42%, including agreed commitments. The Investment Manager is actively pursuing a pipeline of attractive opportunities for the Company within its European markets including in offshore wind. Such opportunities are likely to be of significant scale and therefore will involve investing alongside co-investors. The Investment Manager is developing a network of potential co-investors for TRIG and in order to maintain a balanced and diversified portfolio, the Company may sell down a portion of its larger non-UK investments to such investors.
Helen Mahy CBE, Chairman of TRIG, said: “The Board of TRIG is delighted to make the Company’s second investment in offshore wind in this important market. Offshore wind has developed into an attractive investment category and has been growing at pace in Germany over the last 4 years. TRIG now has investments in each of the two largest offshore wind markets in the world.”
Richard Crawford, of InfraRed Capital Partners, said: “We are pleased to be shareholders alongside Ørsted who have a strong demonstrable track record in the global offshore wind industry. Our ability to source, manage and execute deals in the space is particularly important given the future direction of the European renewables market and the critical importance of offshore wind to meeting climate change targets.”