The Renewables Infrastructure Group Limited – Investment in a portfolio of French solar projects alongside Akuo Energy

4 April 2019 Investments
Investment in a portfolio of French solar projects alongside Akuo Energy

– TRIG has exchanged contracts to invest €57 million (approx. £42 million) in a portfolio of 15 French solar ground-mounted and rooftop PV projects, alongside Akuo Energy (“the Transaction”)

– The Transaction increases TRIG’s portfolio net generating capacity* by approximately 22MW to 680MW

– The Projects are located in mainland France, Corsica and overseas departments, with revenues wholly derived from French feed-in tariffs without exposure to power price market fluctuations for an average of 16 years from acquisition

– The Transaction increases TRIG’s solar PV projects to approximately 30% of overall portfolio value and the portion of non-UK projects in the portfolio to approximately 13%

– The Transaction continues TRIG’s strategy of investing in long-term income-producing operating projects diversified by geography, power market and technology

* Net generating capacity is expressed pro rata to TRIG’s equity interests in the Projects

Richard Crawford, Director – Infrastructure at InfraRed Capital Partners, Investment Manager to TRIG, said: “TRIG’s new partnership with Akuo Energy expands its French power production and further diversifies the Company’s portfolio. The transaction adds attractive, highly predictable revenue streams to TRIG through the French feed-in tariff mechanism at a time when the volume of solar opportunities in the UK is expected to decline with the reductions in government support programmes.”

The Board of TRIG is pleased to announce that an agreement has been reached between the Company and Akuo Energy Group (“Akuo”) on terms for an investment in a portfolio of 15 operating (brownfield) French solar photovoltaic (PV) projects (“the Projects”) alongside Akuo, one of France’s leading independent renewable energy producers.

The Transaction comprises the purchase of a 49% equity interest in a portfolio holding company together with a mezzanine-level loan. The total consideration for the Transaction is €57 million (approximately £42 million) which is being funded from the Group’s acquisition facility with Royal Bank of Scotland plc and National Australia Bank Limited. As a significant equity partner in the Projects, TRIG will have shareholder rights appropriate for investments of this nature. Completion of the Transaction is subject to project lender consents expected in January 2016. RES, TRIG’s portfolio operations manager, will represent TRIG on the supervisory board managing the portfolio. Akuo will continue to provide detailed day-to-day administration as well as operations and maintenance through its directly employed teams across the Projects.

The Projects, commissioned from December 2010 to May 2012, all benefit from power purchase agreements of up to 20 years with EDF, providing fixed, index linked revenues per MWh. They also benefit from broad geographical diversification between mainland France (3 projects, 17.9 MW gross capacity), Corsica (4 projects, 14.0 MW), La Réunion (6 projects, 12.4 MW) and Guadeloupe (2 projects, 4.5 MW) hosting 36%, 32%, 25% and 7% of net capacity respectively (pro rata to TRIG’s equity interests). The portfolio holding company has controlling equity interests in the underlying projects of between 51% and 100%, investing alongside local parties in 10 of the projects. The Projects have aggregate gross generating capacity of approximately 49MW and net generating capacity (pro rata to TRIG’s equity interest) of 21.7MW. Nine of the projects are ground-mounted and six are roof-mounted.

The Projects are being purchased each with long-term amortising project financing in place representing on average approximately 65% of the Projects’ enterprise value reflecting the predictability of the revenue streams available under French feed-in tariffs.

The Transaction is in line with TRIG’s published investment policy.

Following the completion of the Transaction, TRIG’s portfolio will be comprised of 51 projects with approximately 70% of the projects by value being onshore wind and 30% being solar PV.

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