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Foresight buys 50MW UK project ahead of 100MW pipeline

The acquisition, backed by a £55m revolving credit facility, is the fund’s second-largest in the UK to date.

The London-listed Foresight Solar Fund has secured a deal to buy a 49.6MW solar farm in the UK in its second large-scale solar move this month.

The fund bought the Sandridge project from German developer Goldbeck Solar, which connected to the asset to the grid in March 2016 and secured a 1.3 ROC subsidy banding for the site. Foresight said it has also bought the beneficial cash flows generated by the project since the beginning of this year.

The deal was funded by a new £55 million ($68.3 million; €64.6 million) revolving credit facility agreed with Santander. A spokesperson for Foresight told Infrastructure Investor that the firm added some of its own equity towards the deal but declined to disclose the purchase price.

The facility was provided at a rate of 2 percent above LIBOR and Foresight said it will also be used to fund a pipeline of about 100MW of projects. It will be repaid via equity issuances, the firm added.

“The purchase of Sandridge is in line with the company's cautious growth strategy, minimising the impact of cash drag for investors,” said Alex Ohlsson, chairman of Foresight Solar Fund. “The new credit facility was secured at attractive terms and will allow the company to remain competitive when targeting pipeline opportunities during the course of 2017.”

The Sandridge project was originally rejected by local authorities in 2014 but the decision was then overturned by the UK government’s Planning Inspectorate. It becomes the second solar farm bought by Foresight this month after the firm acquired the 72MW Shotwick project, the UK’s largest. At 49.6MW, Sandridge becomes the fund’s second-biggest and brings its portfolio to 470MW across 18 assets.

The deal is the latest in a string of acquisitions in the UK solar sector since the outset of 2017 including purchases by BlackRock, Equitix and the entrance of EFG Hermes to the market with a £470 million buy.