Foresight in £100m fundraise

The firm’s London-listed solar fund is the first UK renewables YieldCo to go back to the market after a lull of nearly six months.

Foresight Solar Fund intends to raise up to £100 million (€128 million; $163 million) through an initial placing and offer on the London Stock Exchange.

The proceeds will be used by the solar-focused investment company to complete the acquisition of the Bournemouth and Kencot plants, which have now been connected to the grid and have an operational 74 megawatts (MW) combined generating capacity. Respectively located in Dorset and Oxfordshire, UK, they bring the fund’s total capacity to 185MW.

A placing programme will also be created by the firm to fund, along with its existing debt facilities, further UK solar acquisitions. The programme, still subject to shareholder approval, will allow the company to issue up to 200 million new shares (worth about £200 million) less the number of shares issued during the initial placing. It will run for 12 months.

Since being launched in October 2013, Foresight Solar has acquired – with some assets still pending Renewables Obligation Certificate (ROC) accreditation – nine operational assets with a combined value of about £239 million. The company will manage a portfolio of £250 million upon completion of its latest transactions.

The Foresight fund ranks among the flurry of YieldCos – publicly traded companies that own a portfolio of projects and distribute cash flows produced to shareholders – that have launched in the UK over the last 18 months, capitalising on investors’ hunger for yield and a maturing renewable energy market.

Appetite for such vehicles seems to have ebbed over the last six months, however, with a number of both new and existing companies missing their fundraising targets. Foresight is the first to return to the market since The Renewables Infrastructure Group raised £66.2 million in late March.