MIDIS, Santander lead solar fund refinancing

The UK’s Foresight Solar Fund has reached financial close on a £160m long-term debt facility.

Foresight Solar Fund, the London Stock Exchange-listed fund managed by the UK’s Foresight Group, has put in place a refinancing for its current £150 million (€187 million; $214 million) short-term acquisition facility, sister publication Private Debt Investor reported.

The new £160 million long-term debt facility has been provided by Macquarie Infrastructure Debt Investment Solutions (MIDIS) and Abbey National Treasury Services, which trades as Santander Global Corporate Banking.

MIDIS has provided tranches of fixed-rate and index-linked debt amortising over 18.5 years; while Santander has provided a term loan amortising over eight years as well as a £40 million revolving acquisition facility. The expected average interest cost of the long-term debt at financial close is 2.59 percent.

Tom van Rijsewijk, senior vice president of MIDIS, said it was “a great opportunity for MIDIS to provide debt against a diversified UK solar portfolio with low gearing levels”.

The fund, which was launched with an IPO in 2013, has 16 operational and accredited solar assets in the UK with capacity of 338 megawatts paying an inflation-linked dividend. It is targeting a full-year dividend for the 2016 financial year of 6.17 pence.

The fund signed an agreement with a single provider to enter a five-year Power Purchase Agreement (PPA) for 15 of the 16 assets in the portfolio following a portfolio tender process.

Upon its IPO, the solar fund raised proceeds of £150 million and, in October 2014, subsequently announced a placing of up to 200 million shares which had raised £162 million when it closed in September last year.

Foresight Group, which focuses on infrastructure and private equity, has £1.8 billion of assets under management across a number of funds covering listed vehicles, limited partnerships, enterprise investment schemes, and venture capital trusts.