The Royal Bank of Scotland (RBS) and Investec Bank have closed the syndication for a GBP400 million senior secured acquisition facility, which financed the purchase of a portfolio of UK solar projects owned by funds managed by Octopus Investments.
The facility attracted strong interest from the banking and institutional investor markets, closing well oversubscribed.
The portfolio consists of 74 operational, UK-based ground mounted solar projects that Octopus acquired from Lightsource Renewable Energy Ltd, the project developer.
The 522MWp portfolio, which is diversified across the south east and west of the United Kingdom, has projects with 20 year fixed income tariffs under the UK Government’s Renewables Obligation (RO) subsidy regime.
Octopus is a fund management company with over £5 billion of funds under management. Over the last five years Octopus has built a renewable energy portfolio of over GBP1.9 billion across solar, wind, anaerobic digestion, landfill gas and biomass, predominantly located in the UK.
Lightsource is a solar developer in the UK, having delivered over 1GW of ground mounted solar projects
Matt Setchell head of Renewables at Octopus, said:
“We are proud to partner yet again with RBS and Investec. The solar market is now an established and maturing industry that offers attractive returns for our investors and we are pleased to have the backing of this leading group of lenders as we continue to invest in the sector. We look forward to working with RBS and Investec on further refinancings in the future as we expand our energy platform and look for new investment opportunities for our investors.”
Olivier Fricot, head of Power and Infrastructure Lending, Investec, said:
“We are delighted to have closed what is a landmark transaction for the sector with Octopus and Lightsource, two of our long standing relationships. It further endorses the expertise of our team in the UK solar and wider renewables sectors where we continue to see strong levels of lending and M&A activity."
Craig Love, Director, Infrastructure and Structured Finance, RBS, said:
“We are glad that our sector and execution expertise, along with our international distribution network, were able to help deliver the right result for Octopus and its investors. RBS has been at the forefront of the UK solar market since its inception in 2010, has funded 1.2GW of projects to-date and, despite recent regulatory changes, retains a strong pipeline of solar projects going forward.”