TIDMWIND
RNS Number : 2462W
Renewable Energy Generation Ltd
24 January 2013
24 January 2013
RENEWABLE ENERGY GENERATION ENTERS STRATEGIC PARTNERSHIP WITH
BLACKROCK WITH SALE OF WIND FARM PORTFOLIO
Renewable Energy Generation Limited ("REG") (AIM: WIND), the UK
renewable energy group, announces that it has entered a long term
strategic partnership with a fund managed by BlackRock
("BlackRock") (the "Transaction"). The Transaction comprises three
key components:
1) The immediate sale of two of REG's newly built wind farms at
Sancton Hill (10MW) and South Sharpley (6MW) for a total enterprise
value of GBP32.1m which results in upfront cash consideration of
GBP16.15m, contingent deferred consideration of GBP0.65m and
BlackRock assuming project net debt of GBP15.3m. REG anticipates
selling a further 4MW wind farm to BlackRock in spring 2013.
2) A long term Asset Management Agreement ("AMA"), on normal
commercial terms, under which REG will manage certain wind farms
for BlackRock in return for an asset management fee. Under the AMA,
REG will manage the operations of Sancton Hill and South Sharpley
with immediate effect. The AMA will apply to any other wind farms
sold by REG to BlackRock and may also include other wind farms
owned by BlackRock but not developed by REG.
3) An Asset Investment Agreement ("AIA") which provides a
framework for future co-operation between REG and BlackRock, under
which, inter alia, BlackRock may acquire wind farms which REG may
elect to sell in the future.
Strategic Rationale
REG's core business is the development, construction and
operation of wind farms. It has established an experienced team
that creates value for its shareholders by identifying sites to
progress through planning and construction into operation. REG
currently operates twelve wind projects across the UK with a total
capacity of 57.15MW, has two further projects under construction
totalling 10MW and six consented schemes comprising a further 30MW.
The Company's development pipeline amounts to around 1,000MW, with
82MW of projects awaiting a planning decision and a further 70MW of
planning submissions anticipated in the current year to the end of
June 2013.
REG's strategy of investing in its development team is now
delivering significant growth of new projects. The strategic
partnership with BlackRock gives REG the opportunity and
flexibility to realise the significant value which has been created
through developing well-structured wind farms and to recycle
capital through future asset sales in order to accelerate its
delivery of operational sites. As such, it is consistent with the
route to shareholder returns set out in REG's 2012 results
presentation.
REG intends to use part of the sale proceeds of the Transaction
to fund immediate project build, including Denzell Downs, St.
Breock and High Down wind farms in Cornwall which together total
21MW. In addition the Board today announces it will be monitoring
opportunities to make use of the authority conferred on it to make
on-market purchases of the Company's ordinary shares at valuation
levels the Board considers appropriate. Any such purchases will be
effected within the Company's general buyback authority of 10% of
its issued share capital as approved by shareholders at the recent
AGM and the AIM Rules for Companies ("AIM Rules"). The maximum
price which may be paid for each ordinary share will be no more
than 105% of the average middle market closing price of a REG share
for the five business days preceding the date of acquisition. The
timing and quantum of any purchases will be determined in
consultation with its broker with regard to the prevailing market
price of the Company's shares, prevailing market conditions and any
other relevant considerations. Any purchases will be funded out of
the Company's cash balances. Any shares acquired pursuant to the
buyback programme will be cancelled or held in treasury and the
acquisition will be notified to a Regulatory Information Service in
accordance with the AIM Rules.
The Company will announce its interim results for the six months
to 31 December 2012 on Monday 4 February. There will be a
presentation to analysts in the offices of City Profile on the day
of the results, starting at 9.30am. The address for City Profile is
Augustine House, 6A Austin Friars, London, EC2N 2HA.
Andrew Whalley, Chief Executive Officer of REG, said:
"We are delighted to enter a long term relationship with
BlackRock. REG has invested heavily in its development pipeline and
is now seeing the benefits of this expenditure in terms of new
planning applications and consents. A strategic partnership with
BlackRock allows us to continue to recycle capital to fund future
growth and enhance returns to shareholders. The Transaction
demonstrates the inherent value of the REG business, whilst the AMA
allows REG to continue to manage the projects on a day to day
basis.
The proceeds from the disposal will be reinvested both into
delivering new operational projects and into buying back our
shares, which have been trading at a substantial discount to REG's
intrinsic value."
Jim Barry, Managing Director at BlackRock, commented:
"Our partnership with REG creates an exciting investment
opportunity for BlackRock's clients. We look forward to working
together with such a high quality developer in the UK onshore wind
sector."
Enquiries:
Renewable Energy Generation Limited
Andrew Whalley, Chief Executive Officer
David Crockford, Finance Director +44 (0)1483 901
Ian Lawrence, Communications Manager 790
Smith & Williamson Corporate Finance Limited
(Nominated Adviser) +44 (0)117 376
Martyn Fraser 2213
Cenkos (Corporate Broker) +44 (0)20 7397
Bobbie Hilliam/Max Hartley 8900
Evercore Partners (Financial Adviser) +44 (0)20 7653
Read Gomm / Andrew Donovan / James Byrne 6000
City Profile +44 (0)20 7448
Simon Courtenay/Abigail Genis 3244
Notes to editors
Renewable Energy Generation Ltd (REG) is a UK renewable energy
group. Its main business is the development, construction and
operation of wind farms and generating power from refined used
cooking oil.
REG Windpower: based in Truro and Bath, UK, it currently
operates 12 wind projects in Cambridgeshire, Cornwall, County
Durham, Yorkshire, Cumbria and Gwynedd, with a total capacity of
57.15MW with a further 10MW under construction and around 1000MW of
projects in development.
REG Bio-Power UK Ltd: based in Nottingham, UK: it operates
electricity generation plant powered by fuel recovered from used
cooking oil.
Headquartered in Jersey, REG was admitted to trading on AIM, a
market operated by the London Stock Exchange, in May 2005 (AIM:
WIND).
www.renewableenergygeneration.co.uk
About BlackRock
BlackRock is a leader in investment management, risk management
and advisory services for institutional and retail clients
worldwide. At December 31, 2012, BlackRock had assets under
management of $3.792 trillion. BlackRock offers products that span
the risk spectrum to meet clients' needs, including active,
enhanced and index strategies across markets and asset classes.
Products are offered in a variety of structures including separate
accounts, mutual funds, iShares(R) (exchange traded funds), and
other pooled investment vehicles. BlackRock also offers risk
management, advisory and enterprise investment system services to a
broad base of institutional investors through BlackRock
Solutions(R). Headquartered in New York City, as of December 31,
2012, the firm has approximately 10,500 employees in 30 countries
and a major presence in key global markets, including North and
South America, Europe, Asia, Australia and the Middle East and
Africa. For additional information, please visit the Company's
website at www.blackrock.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
DISDMGZMNFFGFZM
Renewable Eng. (LSE:WIND)
Historical Stock Chart
From Jun 2024 to Jul 2024
Renewable Eng. (LSE:WIND)
Historical Stock Chart
From Jul 2023 to Jul 2024