The Renewables Infrastructure Group Limited - Acquisition of a further two UK solar parks

Date

Acquisition of a further two UK solar parks

-      Expansion of the TRIG portfolio with the addition of two solar photovoltaic (PV) parks in Devon and Essex with combined generating capacity of approximately 30.4MW for an aggregate consideration of between £34.5 million and £37 million

-      The acquisitions further diversify TRIG's portfolio, with solar now representing 8 out of 22 investments, in line with the growth strategy stated at IPO to acquire additional projects across target geographies and renewable energy technologies

-      The transaction has been funded from the Group's acquisition facility (expected to be repaid from proceeds of the C Share issue announced on 10 March 2014) and from the Company's existing cash resources.

Richard Crawford from InfraRed Capital Partners, TRIG's Investment Manager, said: "These two large solar projects nearly double the generating capacity of TRIG's solar PV portfolio in the UK and France to approximately 62MW, providing further balance and diversification to the TRIG portfolio."

TRIG today announces that, in line with the intentions set out in the prospectus for the Placing, Open Offer and Offer for Subscription published on 10 March 2014, it has invested in two large-scale ground-mounted solar PV generating projects, both on agricultural sites in the South of England. The maximum investment consideration is approximately £37 million, subject to certain value protections and subject to a minimum price of approximately £34.5 million. The investments are without project-level debt, although debt may be introduced in due course to optimise the capital structure.

Tamar Heights Solar Park, located near Barnstaple in Devon, has been recently connected to the grid with a generating capacity of approximately 11.8MW. A 100% interest has been acquired in the project.

The second project is the Stour Fields Solar Park, located near Colchester in Essex. This site is expected to be connected shortly with a generating capacity of approximately 18.7MW. To accommodate the requirements of the vendors, an initial 50% interest in the plant has been acquired and the Group has entered into a put and call option for the acquisition of the remaining 50% which will complete in May 2014. The consideration sum referred to above includes the full 100% interest. 

Both projects have been acquired from a group of private developers, are being constructed by a specialised German EPC contractor with a significant track record in solar PV and incorporate modules supplied by Hanwha SolarOne, a leading solar PV module manufacturer. The Devon site is already connected and the Essex site is expected to be connected by 31 March 2014 to qualify under the UK's support banding of 1.6 renewables obligation certificates (ROCs) per MWh. A price reduction has been agreed in the event this site is connected under the subsequent regime of 1.4 ROCs per MWh, due to take effect from 1 April 2014. Suitable power purchase agreements are being negotiated. The expected asset lives are 25 years from the commencement of operations, with site leases also for 25 years. In addition, TRIG has an option to extend the lease at Stour Fields Solar Park by up to a further five years.