Scatec Solar says a deal to raise its holding in three South African PV projects has been closed. The projects, which have a total capacity of 190 MW, are already in operation under power purchase agreements with utility Eskom.
The deal increases Scatec’s stake in the projects from 39% to 45%, by buying shares from Norwegian investment company Norfund and its partner, pension fund KLP, also based in Norway.
With the transaction finalized, Scatec and asset management company STANLIB Private Equity Infrastructure Fund 1, will take over Norfund’s 21% share in the 75 MW Kalkbult Solar Plant – outside Bloemfontein in the Northern Cape – and KLP Norfund’s 16% shares in both the 75 MW Dreunberg Solar Plant and the 40 MW Linde Solar Plant.
World Bank backs Scatec
Under the terms reported in August, Scatec acquired 33% of the shares, with STANLIB acquiring the balance. The new investment adds to Scatec’s 258 MW solar pipeline in South Africa, which includes a further three, under-construction projects that are expected to be completed late next year.
The Norwegian developer also announced today its equity investments in all six South African PV projects have secured guarantees from the World Bank Group’s Multilateral Investment Guarantee Agency (MIGA). The guarantees cover up to 90% of investments for up to 15 years, against breach of contract and transfer restrictions and convertibility.
“These MIGA guarantees are a cost-efficient way of mitigating risk in an important part of our asset portfolio,” said Scatec Solar CEO Raymond Carlsen. “We are working with multilateral finance institutions across emerging markets, and with these agreements we are again demonstrating how strong partnerships are improving the robustness of our long-term investments.”
According to its most recent financial filings, Scatec has 357 MW of PV in operation worldwide, close to 1.06 GW under construction, and a total project pipeline of 3.82 GW at various stages of development, with around half of that in Africa.