Brookfield eyes ACS/GIP listed renewables vehicle

The Canadian asset manager is in talks with Saeta Yield, the 1.1GW Spanish ‘yieldco’, which recently made its first investments outside its home country as part of its expansion strategy.

Brookfield Asset Management is mulling an offer to buy 100 percent of Saeta Yield, the Spanish renewable energy ‘yieldco’ owned by ACS and Global Infrastructure Partners.

The Canadian firm’s interest was revealed by Saeta Yield on the Spanish Stock Exchange where about 47 percent of the company is publicly owned. The GIP II fund and ACS each hold 24 percent, while Morgan Stanley owns a 5 percent share.

“An affiliate of Brookfield Asset Management has shown a potential interest in the company and has been granted access to information, in the framework of a confidentiality agreement in order to evaluate the possibility of launching a tender offer for all shares outstanding,” the group stated.

GIP invested in the then privately held Saeta Yield in January 2015, buying 24.4 percent from ACS, before the yieldco raised €435 million in an IPO the following month. At the time, Saeta Yield owned operating wind and solar assets in Spain with 688MW of capacity.

The company now owns a portfolio of 1.1GW and in May last year completed its first international deal with the acquisition of two wind farms in Uruguay, which generate 95MW. The expansion abroad was furthered in August when it spent €104 million to buy nine wind farms in Portugal with a capacity of 144MW. It is aiming to have 40 percent of its portfolio based outside Spain later this year.

At a shareholders meeting in June, chairman José Luis Martínez Dalmau admitted that progress was initially marked by volatility due to the “great effort required to explain the yieldco concept, which was almost unheard of in Europe”. The group has displayed returns of 15 percent since being listed, he said.