TRIG in €57m French solar deal

The InfraRed-managed vehicle has invested in a portfolio of 15 projects as it seeks to side-step UK tariff cuts by expanding overseas.

The Renewable Infrastructure Group (TRIG) has acquired a significant stake in a portfolio of French solar projects from local developer Akuo Energy Group.

The €57 million transaction sees the London-listed investment fund buy a 49 percent equity stake in the portfolio holding company and provide the pool of assets with a mezzanine-level loan. It is being funded via TRIG’ existing acquisition facilities with Royal Bank of Scotland and National Australia Bank.

The portfolio comprises 15 operational French solar photovoltaic projects located in mainland France, Corsica, La Réunion and Guadeloupe. The holding company, which has controlling stakes in all of the underlying projects, is investing alongside local parties in 10 of them.

Their revenues are wholly derived from French feed-in tariffs for an average of 16 years from the acquisition, which is expected to complete this month.

“The transaction adds attractive, highly predictable revenue streams to TRIG through the French feed-in tariff mechanism at a time when the volume of solar opportunities in the UK is expected to decline with the reductions in government support programmes,” said Richard Crawford, director for infrastructure at TRIG investment manager InfraRed Capital Partners.

The deal comes as drastic cuts to feed-in tariffs for rooftop solar and small-scale onshore wind installations enter into force in the UK. It is expected to bring the share of solar to 30 percent of TRIG’s overall portfolio value and push the portion of non-UK projects in its holdings to 13 percent.

The company, which raised about £78 million (€106 million; $114 million) through a share issue last November, has a total market capitalisation of about £751 million.