Enel Green Power is divesting majority stakes in Mexican renewable energy projects totalling 1.7GW to Canadian institutional investor Caisse de dépot et placement du Québec and Mexican pension fund investor CKD Infraestructura México SA de CV.
As per the deal terms, Enel has agreed to sell 80% of the share capital in three operating plants totalling 429MW and five under construction projects worth 1.28GW held in a newly-formed Mexican holding company.
The total transaction is worth about $1.35bn, out of which $340m will be paid for the 80% stake sale and the remaining $1.01bn is for loans granted by the buyers.
The portfolio consists of 1 GW solar plants such as Villanueva I (427MW), Villanueva III (327MW) and Don José (238MW) as well as about 0.7 GW from wind farms of Amistad (198 MW), Dominica (200 MW), Palo Alto (129 MW), Salitrillos (93 MW) and Vientos del Altiplano (100 MW).
Enel noted that the projects under construction will be completed by two newly formed subsidiaries.
As part of the deal, Enel will continue with the operations of the renewable energy plants. The company has taken up a new Build, Sell and Operate (BSO) model, which is expected to help grow its renewables’ footprint in the country.
Enel Green Power head, Antonio Cammisecra, said: “The new model represents an opportunity for partners willing to invest in a large and diversified portfolio of projects in strategic areas, supported by long-term power purchase agreements, with the plants developed, built and operated by Enel Green Power.
“This strategy enables us to further exploit our global pipeline of solar and wind projects whereby gain access to additional resources, accelerating our growth. By attracting solid long-term partners in this transaction, EGP confirms the strategic role that Mexico plays in its global presence.
“We are enthusiastic about the opportunities offered by the Mexican renewables market and it is our intention to continue to invest in the country where EGP will play an active role by managing operating assets and developing new initiatives.”
The transaction is subject to several pending ordinary conditions and necessary authorisation from Mexican antitrust authorities and it is expected to be closed by the end of this year.
Enel will retain, control over 300MW of installed capacity which includes wind plants of Stipa Nayaa (74MW), Zopiloapan (70MW) and Sureste (102MW), and the hydroelectric plants of El Gallo (30MW), Chilatan (12MW) and Trojes (8MW), as well as the solar plant COP 16 (134 kW).
Image: Enel to sell majority stake in 1.7GW renewable projects in Mexico. Photo: Courtesy of RK008/FreeDigitalPhotos.net.