Foresight Solar raising cash to fund acquisition – Foresight Solar Fund Limited is seeking authority to issue ordinary shares to allow it to fund the acquisition of a portfolio of 10 ground-based, solar power assets in the UK with a total installed capacity of 72MW for a total cost of GBP30.1 million, to reduce the company’s gearing and to be in a position to raise additional capital when it identifies solar power assets that are suitable for acquisition in accordance with the investment policy.
Foresight Solar expects to publish a circular shortly to convene a general meeting to approve the fund raise.
Background
As at today’s date, the company has no further authority to issue shares and they have drawn down GBP420.3 million under their bank facilities. The group’s gearing, calculated as borrowings as a percentage of the gross asset value was 41 per cent. as at 30 June 2018. These figures do not reflect the impact of the previous issue of shares on 4 July 2018, nor the 114MW UK portfolio acquisition completed on 3 August 2018.
The Target Portfolio
The company has secured exclusivity over a target portfolio of 10 operational solar assets in the UK with a total installed capacity of 72 MW. The assets have been in operation for a minimum period of two years and have received accreditation under the Renewable Obligation scheme ranging from 1.4 to 1.3 ROCs/MWh. The average ROC accreditation banding of the target portfolio is 1.35 ROCs/MWh.
The equity interest in the target portfolio is proposed to be acquired for a consideration of approximately GBP30.1 million, including the economic benefit of all cashflows from 30 June 2018. The target portfolio will be acquired from funds managed by Foresight Group LLP.
The target portfolio currently has debt facilities in place totalling GBP62.1 million, the majority of which is provided by the Royal Bank of Scotland. All of these debt facilities have been arranged on an asset by asset basis and do not benefit from cross-collateralisation. These existing debt facilities expire either on or before 30 September 2019 and it is the company’s intention to refinance the target portfolio before the end of June 2019.
Assuming completion of the acquisition, the company’s solar portfolio will represent a total of 860 MW of installed capacity across 53 solar power assets.
FSFL : Foresight Solar raising cash to fund acquisition