Gore Street fundraise backed by NTMA – Gore Street Energy Storage Fund has entered into agreements to acquire a controlling interest in a 160 MW portfolio of projects in Northern Ireland and the Republic of Ireland. To fund these and a further pipeline of deals, the company plans, by way of an institutional placing, offer for subscription and intermediaries offer, to raise up to £50m now and enter into a subsequent placing programme of new ordinary shares and/or C shares. Shareholders need to approve this.
£31m has already been committed for investment in the company, subject to the satisfaction of certain conditions. Of this £31m, £6m will be invested now as part of the issue and a further £25m will be invested after the issue by the National Treasury Management Agency (“NTMA”) (as controller and manager of the Ireland Strategic Investment Fund (“ISIF”)). NTMA is putting up £5m of the £6m.
NTMA’s subscription is conditional on, amongst other things, a minimum fundraise of £15m in the issue (excluding the £5m Initial NTMA subscription).
Some details:
- two projects of 50MW each located in Northern Ireland and a further two projects of 30 MW each located in the Republic of Ireland
- an estimated total funding requirement of approximately £77m for project construction, acquisition and capital expenditure
- investment by way of shareholder loans carrying 10% interest, stepping down to 8% or 9% upon the commissioning of the projects with 51% of any excess profits due to the company
- the aggregate return from these new investments in Ireland has the potential to be significantly higher than the unlevered target returns of 10-12% (before fees and expenses) from Gore Street’s portfolio on full investment noted in the IPO prospectus in May 2018. Once operational these returns are expected to contribute significantly to income
- an additional option to purchase a further 190MW portfolio of energy storage projects in Ireland, bringing the total transaction to 350MW
- this will be one of the largest energy storage acquisitions in Europe and one of the largest deals of its kind globally in 2019 to date
- investment into projects developed by, and joint venture partner with, Low Carbon, a developer with a strong track record in battery storage and diverse renewable infrastructure technologies
Alex O’Cinneide, CEO of Gore Street Capital, the investment adviser, commented: “The investment in the Irish projects will represent one of Europe’s largest energy storage acquisitions and one of the largest of its kind this year globally. Ireland’s energy storage market is at a critical point in time, with significant investment opportunities rapidly arising, driven in no small part by the ambitious target of 40% renewable energy provision by 2020 set recently by the Irish State. The anticipated returns delivered by the acquisition portfolio have the potential to be significantly greater than those targeted by the company in its IPO prospectus. Gore Street is well positioned to take advantage of these opportunities in the country for the benefit of stakeholders and shareholders and this transaction further supports the Adviser’s intention to grow the fund significantly over time.”
GSF : Gore Street fundraise backed by NTMA