Munich Re buys 50% UK power plant stake(2)

Ireland’s ESB has offloaded its Marchwood holding as part of a deal with the Irish state to pay a €400m special dividend.

ESB Group, the state-owned Irish electricity company, has sold a 50 percent stake in the UK’s Marchwood power station to German insurer Munich Re. The amount paid was undisclosed but was reported to be around €180 million.

The stake was sold so that ESB can pay a €400 million special dividend to the Irish state next year from the sale of non-strategic generation assets, on top of a €65 million special dividend paid this year.

Marchwood, which ESB jointly owned with UK utility SSE, operates what it claims is one of the UK’s most efficient combined cycle gas turbine power plants in the UK. The plant, based near Southampton, generates some 800 megawatts (MW).

Speaking about Marchwood, Paddy Hayes, director of generation and wholesale markets at ESB said in a statement: “ESB initially developed the power plant project and ESB International acted as owner’s engineer during construction. By every measure, Marchwood has been a very successful project.”

Macquarie Capital (Europe) managed the sales process, which ESB claimed had achieved a “competitive price”.

ESB is also looking to sell its 50 percent stake in Bizkaia Energia, owner of a 755MW power plant in Southern Spain. Reports indicate the Bizkaia sale is expected to complete in the new year.