LONDON (Alliance News) - Asset manager Gresham House PLC on Wednesday announced a GBP200 million initial public offering of Gresham House Energy Storage Fund PLC.
The fund, which will float on the specialist fund segment of London's Main Market, will invest in energy storage systems that provide National Grid services in Great Britain.
According to the fund, these energy storage systems will support both the grid's stability and its increasing reliance on renewable energy sources like wind and solar, which are more intermittent.
Proceeds from the IPO have been contracted to be deployed in a seed portfolio, producing a total of 70 megawatts across five sites from the date of admission to the exchange. Exclusivity over a further 132 megawatts worth of ready-to-build projects has also been agreed.
An 80 megawatt pipeline project is also being negotiated at an advanced stage, as well as a further pipeline exceeding 50 megawatts. In total, this means Gresham House Energy Storage could have the ability to deploy 200 megawatts within 12 months of listing.
Gresham House Energy Storage will have a sustainable yield of 7.0% and a target dividend payment of 7.0 pence, starting at 4.5p in its first year.
The target net asset value of the fund will be 8.0% per annum with the aim of increasing the net asset value total return target to 15% per annum.
Cornerstone investment of approximately GBP33.5 million has been agreed, accounting for roughly 17% of the shares to be issued on first admission.
"We believe [energy storage systems] has significant potential from an investment standpoint and is fundamental to a renewable energy future in the UK. We are confident that the experience and expertise of our team, coupled with our identified seed portfolio and firm pipeline will be able to deliver excellent near-term shareholder value in what is a rapidly emerging next generation infrastructure sector," said Gresham House Energy Storage Chairman John Leggate.
Shares in Gresham House were up 0.2% at 470.00p on Wednesday.
