Brookfield partners with KKR in $500m solar push

The deal for X-Elio partially realises an investment from KKR’s $3.1bn second infrastructure fund.

 The publicly-listed Brookfield Renewable Partners vehicle has ploughed “in the range of” $500 million into X-Elio, taking a 50 percent stake in the Spain-based solar group.

Brookfield, along with what it described as its “institutional partners”, acquired a 20 percent stake in the developer and operator from Acek, a subsidiary of Spain’s Gestamp, with a further 30 percent acquired from KKR, which had taken an 80 percent stake in the company in 2015, in a deal which valued the company at $1 billion.

KKR and Brookfield Renewable will jointly own X-Elio, which has 273MW of operating capacity, 1.4GW under construction and 4.8GW of a development pipeline.

While the company is headquartered in Spain, the bulk of its operations is outside the country with projects in various markets including the US, Mexico, Chile, Japan and Australia.

The transaction offered a “unique opportunity” to add development capabilities to Brookfield Renewable, said Sachin Shah, chief executive of Brookfield Renewable. Last year the firm bought the Europe-focused renewables group Saeta Yield from Global Infrastructure Partners and ACS via the Brookfield-owned TerraForm Power.

KKR’s investment in X-Elio came through its 2014-vntage $3.1 billion Global Infrastructure Investors II fund. X-Elio had generated a gross money multiple of 1.4x and a gross internal rate of return of 15.8 percent for the fund as at the end of June 2018, according to a KKR presentation.

Brookfield had not responded to a request for comment at the time of publication. KKR was not available for comment.