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KGAL acquires Swedish wind duo in €22m deal

The firm’s entry into the Swedish renewables market comes amid the launch of a fourth renewable energy fund by KGAL last year.

German investment manager KGAL has bought two wind farms in Sweden from local developer Eolus Vind in a deal worth €22 million.

The transaction comprises the 8.8MW Gunillaberg project and the 6.6MW Lunna wind farm. Both sites are still under development by Eolus Vind and are set to be completed in August.

While KGAL’s renewable energy portfolio includes wind and solar projects across western and southern Europe, the latest acquisition marks its first investment in Sweden and second in the Scandinavia region after it bought the 24.6MW Silovuori wind farm in Sweden at the end of 2015.

The two projects were acquired by KGAL's Enhanced Sustainable Power Fund 3 which was launched in 2013. The firm launched a fourth vehicle last July, targeting €500 million.

In response to squeezed returns in Europe’s secondary market, KGAL shifted its strategy for the fourth fund with investments in mature markets focusing on the development and construction phase. ESPF4 has a target IRR of between 8 and 12 percent.

KGAL’s acquisition of the two Swedish projects brings its wind portfolio to about 630MW while its total renewable energy capacity amounts to just over 1GW.