(Alliance News) - John Laing Group PLC on Thursday offered an update on recent investments and sales, as the investor continues to offload of its renewables portfolio.
The infrastructure project investor said it has completed the sale of its Irish wind farm, Glencarbry, to Greencoat Renewables PLC for EUR31.2 million.
This sale value represents a 6% premium to John Laing's book value for the asset at December 31, and is equivalent to a money multiple on its investment of 1.3 times.
Located in County Tipperary in the Republic of Ireland, Glencarbry wind farm has a total capacity of 35.6MW. Glencarbry was acquired by John Laing in 2015 and brought into operation in 2017.
"This divestment is in line with the group's strategy to reduce its exposure to renewable energy generation assets," John Laing said.
It continued: "Glencarbry is a mature operational project within the group's secondary portfolio, and this sale is also consistent with the group's strategy to realise these types of secondary assets and re-invest the proceeds in new opportunities in greenfield projects and in economic infrastructure businesses and platforms."
At the end of 2019, the total value of John Laing's renewable energy portfolio was GBP607 million. Following the divestments of 10 renewable energy assets during 2020, including the sale of its entire Australia wind farm portfolio, as well as the recent sales of the Rammeldalsberget and Glencarbry wind farms, the total value of the company's renewable energy portfolio has been reduced to GBP234 million.
As a result, the company's PPP & Projects business line now representing around 80% of total portfolio value.
John Laing Chief Executive Ben Loomes said: "Following on from the completion of the sales of our wind farm assets in Australia and Sweden earlier this month, the sale of Glencarbry represents a further important step in our strategy to realise fully our Renewable Energy generation assets over the next two years.
"Importantly, recent renewable energy divestments, including Glencarbry, Rammeldalsberget and the Australian portfolio, have all been at values representing premia to book value, further underpinning our portfolio valuation as well as crystallising value for our shareholders."
Greencoat Renewables said the deal brings its total installed capacity to 685.6MW
The wind farm's revenue is contracted under the REFIT 2 scheme, providing a long-term guaranteed minimum floor price for the electricity generated until July 2032, Greencoat noted.
Greencoat Renewables funded the deal through its existing credit facility. Following the acquisition, total borrowings will represent 49% of gross asset value, in the middle of the company's target gearing range.
Separately, John Laing went on a spending spree in Germany, snapping up two regional telecommunications businesses, in order to create a single platform to invest in fibre-to-the-premises.
The deal comprises the acquisition of 100% shareholdings in two regional and complementary telecommunications firms in southern and western Germany for a total investment up to EUR30 million.
John Laing added: "These businesses are EFN eifel-net Internet-Provider GmbH and Jobst NET GmbH, and each is in the early stages of FTTP roll-out programmes, focusing on delivering connectivity to under-served suburban and rural communities in Germany."
John Laing will fund the initial investment in fibre roll-out programmes over the next 12 months.
"Given the potential growth of the roll-out strategy, this platform represents a material opportunity for further investment by John Laing over time, and which could represent a total equity investment in excess of EUR100 million over the next three years," the company added.
It continued: "This investment fits with John Laing's strategy of investing in businesses and platforms with growth potential, and which are asset intensive and provide essential infrastructure."
Shares in John Laing were 0.6% higher in London on Thursday morning at 315.40 pence each. Greencoat Renewables shares were up 2.6% at EUR1.18.
By Paul McGowan; paulmcgowan@alliancenews.com
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Greencoat Renewables (GRP)