Making the best of a forced sale

The EnerCap Power Fund, managed by Prague-based fund manager EnerCap Capital Partners, seized on low interest rates and a forced loan portfolio sale to refinance its 18-megawatt (MW) Horni Lodenice wind farm in eastern Czech Republic.

A new debt facility comprises a CZK497.8 million (€18 million; $20 million) 10-year term loan together with interest rate swaps, both provided by Ceska Sporitelna, a Czech bank and member of Erste Group.

The wind farm, which is the third-largest in the Czech Republic, was originally financed by Austrian lender Investkredit, which was subsumed into parent Volksbank in 2012.

Following a bailout from the Austrian state, Volksbank put its loan book, including the Horni Lodenice debt, up for sale earlier this year. With uncertainty over the future owner of the senior debt, EnerCap opted to refinance and prepay the existing loan. This gave the firm the opportunity to lock in historically low Czech koruna borrowing costs under the new loan.

Constructed between 2008 and 2009, Horni Lodenice comprises nine wind turbines with a total initial installed capacity of 18MW. It is located near the city of Olomouc.

“The outcome of the Volksbank loan book sale was uncertain, and we took the opportunity to create further value in one of our projects, something that has been difficult in Central Europe in recent years,” said Shane Woodroffe, a partner at EnerCap, in a statement.