Octopus Renewables Infrastructure Trust has announced that, as part of its capital recycling programme, it has entered into a conditional agreement to sell the Ljungbyholm onshore wind farm in Sweden to a German institutional investor for total consideration of approximately €74 million. The sale price is in line with the Company's valuation of Ljungbyholm as at 31 March 2024 and will realise an IRR of approximately 11% over the lifetime of ORIT's investment, with the net proceeds expected to be used predominantly to repay part of ORIT's short-term debt facility. Completion of the Transaction is subject, inter alia, to foreign direct investment approval by the Swedish Inspectorate for Strategic Products, which is expected later this year.
ORIT acquired the 48 MW wind farm at pre-construction stage in March 2020, investing c. €68m in the project. The Investment Manager, Octopus Energy Generation managed the construction phase, successfully bringing the wind farm into operation in June 2021.
The Transaction forms part of the Company's capital recycling programme, and follows the sale of two Polish onshore wind assets in December 2023 and the divestment of an option over a Spanish solar PV project in January 2024. Upon completion of the Transaction, the capital recycling programme will have generated approximately £159 million. Other capital recycling projects are in progress and the Company will provide further updates when appropriate.
ORIT was advised on the Transaction by Newsec Energy Transition AB.
Phil Austin, Chairman of Octopus Renewables Infrastructure Trust plc, commented: 'We are pleased to enter this transaction, which is another key part of ORIT's capital recycling programme. The agreed price further supports the Company's valuations, and once the Transaction is completed it will enable us to reduce our short-term debt which, as we have previously communicated, is a key objective for us at this time. Ljungbyholm was the Company's first investment following ORIT's IPO, and the exit further demonstrates our Investment Manager's ability to manage the construction and operation of new renewable energy assets, which helps to drive the transition to net zero.'
Source: Octopus Renewables Infrastructure Trust
