Gaia Infrastructure Capital Limited has announced that the company’s listing has transferred from a SPAC (Special Purpose Acquisition Company) to the Investment Services sector of the JSE Limited.
The move was facilitated by the completion of the acquisition of an effective see-through economic interest of 25.2% in Dorper Wind Farm Limited for ZAR501 million (US$37 million). The viable asset transaction became unconditional on 20 December 2016, on receipt of the approval for the acquisition from the Department of Energy (DOE), being the remaining material condition precedent for the viable asset transaction. The acquisition meets GAIA’s investment criteria that were updated in its circular in September 2015.
Dorper owns a fully operational wind farm located in the Eastern Cape, with a contracted generating capacity of approximately 98MW. The wind farm forms part of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP) currently managed by the DOE. Dorper was selected as a preferred bidder in the first round of the DOE’s REIPPPP and entered into a 20 year power purchase agreement (PPA) with state owned energy provider Eskom Holding SOC Limited and associated implementation agreement with the DOE, reaching financial close in the same month.
GAIA has board representation on the board of Dorper. Commenting on the transaction, Prudence Lebina, Chief Executive Officer of GAIA said:
“In line with our listing commitments, we have reached a notable milestone with the completion of our first transaction, enabling GAIA to become a fully-fledged infrastructure investment holding company. We have every confidence in Dorper’s prospects: the wind farm has been operational since 2014 and has a 20-year PPA with Eskom as well as a Government-backed guarantee. Furthermore, the acquisition is fully aligned with our investment mandate and provides a compelling investment case for investors, including inflation-linked, low volatile returns with predictable cash flows.
Having completed this first transaction, our attention now turns to reviewing other opportunities that are on our radar screen and within our focus on the energy, transport and water and sanitation sectors. All potential transactions will be meticulously analyzed to ensure that they meet our stringent investment criteria. These include our requirement for operational or near-operational projects, returns of CPI plus 6% (before fees), predictable cash flows and responsible environmental, social and governance impacts, among others.”