Scatec ASA has today signed an agreement with a subsidiary of Stanlib Infrastructure Fund II, managed by Stanlib Asset Management (Stanlib), to sell its 42% equity share in the 258 MW Upington solar power plant for a gross consideration of R 979 million.
Scatec, a renewable energy company in emerging markets, is headquartered in Oslo, Norway and listed on the Oslo Stock Exchange
“Today’s transaction is in line with our strategy to optimise our portfolio as presented at our Capital Markets Update in September 2022 and will release capital for new investments in renewable energy,” Scatec CEO Terje Pilskog.
“We are very pleased to secure a value accretive transaction and are confident that STANLIB will be a solid owner of the asset going forward.”
The solar plant in Upington reached COD in 2020 and were awarded in the fourth bidding round under the Renewable Energy Independent Power Producer Programme.
The plant generates approximately one third of the proportionate power production EBITDA in South Africa for Scatec. Scatec will continue to provide Operations & Maintenance and Asset Management services to the Upington power plant.
The Upington solar power complex is estimated to deliver an annual production of 650 GWh, providing clean energy to around 120,000 households and lead to the abatement of more than 600,000 tonnes of CO² emissions annually.
“We entered South Africa back in 2010 and have since grown into a leading renewable energy player in the country. South Africa remains a focus market for us, and we will continue to build scale through new investments, including the Kenhardt project under construction and the new Grootfontein project secured in the fifth bidding round,” adds Pilskog.
The transaction is expected to generate a net accounting gain of approximately NOK760 million or R1.3 billion on a consolidated basis and NOK310 million or R534 million on a proportionate basis. The difference is primarily explained by the D&C margin related to the projects which has been eliminated in the consolidated statement of financial positions. The final accounting effects will be determined on closing of the transaction.
Norfund is also selling its 18% equity share to Stanlib as part of the same transaction. The transaction is subject to the customary consents and is expected to close in the first half of 2023.
Stanlib is the second largest asset manager (by assets under management) in South Africa, and part of Standard Bank Group.
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