London-listed Foresight Solar Fund has clinched its first overseas deal with the acquisition of a 48.5 percent stake in Australia’s Bannerton Solar Farm, which has a peak capacity of 110MW.
The vehicle is paying A$5.5 million ($4.3 million; €3.7 million) to a joint venture between Syncline Energy and Foresight Solar Australia, an amount that includes an initial upfront payment and deferred payments during construction. Foresight Solar Fund, which has a market cap of £456 million ($607 million; €517 million) is co-investing alongside KDB Infrastructure Asset Management and Hanwha Energy Corporation Singapore in the Bannerton deal.
Foresight said the amount paid for the project might increase if it starts generating revenue earlier than expected and construction savings are netted. It added it will use a revolving facility from Santander to pay for the acquisition and noted the project will benefit from an Australian dollar-denominated facility from state-backed Clean Energy Finance Corporation, during construction and operation.
The solar farm has a 10-year contract with the Victorian government for the sale of a portion of the large-scale generation certificates (LGCs) it produces and a 17-year fixed-price power-purchase agreement with retailer Alinta Energy, for part of the electricity it produces. A portion of the project’s LGCs and electricity will be sold on the open market, though.
“This first overseas acquisition represents the development of the company’s international growth strategy, which sees the company’s portfolio now reach a total of 528MW of capacity installed or under construction,” commented Foresight chairman Alex Ohlsson.
“This acquisition follows the investment manager’s move to establish an office in Sydney in early 2016, prior to bringing its first Australian asset under management, Barcaldine Solar Farm, in early 2017,” he added.
In addition to its overseas activities, the manager is currently targeting £500 million for its Foresight Energy Infrastructure Partners fund, set for a first close by the end of the year.