Balfour Beatty, Equitix close £163m OFTO financing

UK developer Balfour Beatty and fund manager Equitix have closed financing on the 219MW Humber Gateway's Offshore Transmission Owner (OFTO) project.
 
The assets connecting E.ON's offshore wind farm in the UK to the grid include one offshore and one onshore substation. A subsea 18km cable circuit and another 30km one on land are also included. The wind farm began operations in May 2015.
 
Financing for the deal was led by the European Investment Bank, which provided an £82 million ($109.4 million; €97.4 million) fixed-rate loan. The loan is rated Baa1 by Moody's, which said the high level of leverage – 87 percent – could put some pressure on credit quality.
 
The EIB was joined by Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust Bank and Société Générale. Laughlan Waterston, head of energy at SMBC, told Infrastructure Investor that the banking trio provided senior debt in equal measure, amounting to about £27 million each. 
 
Balfour Beatty contributed £12.5 million of the £21 million equity injection, with the remainder provided by Equitix. 
 
“Equitix' commitment to the offshore transmission market is testament to our investors' appetite for long-term, availability-based, inflation-linked, UK infrastructure,” said Hugh Crossley, Equitix' chief investment officer.