(Alliance News) - SSE PLC said Tuesday it has has agreed to sell its 25% non-operating stake in Walney offshore wind farm to Greencoat UK Wind PLC.
The stake equates to 92 megawatts of capacity at the wind farm - located about 9 miles off the Cumbrian coast with a capacity of 367.2 megawatts - and will be sold for a total consideration of GBP350 million.
"The sale of Walney marks the first stage of SSE's disposal plans. As previously announced, a significant part of the disposal programme will be non-core assets," SSE said.
The blue-chip energy firm continued: "As essentially a financial investment, Walney clearly falls into this category. The transaction is indicative of the quality and optionality contained in SSE's portfolio of projects and assets, demonstrating its ability to deliver value through disposals."
SSE is planning to offload GBP2 billion of assets by autumn 2021.
Following the stake sale, SSE's renewable generation capacity will be around 3.9 gigawatts.
The acquisition will be funded by Greencoat UK Wind's acquisition facility, recently re-sized to GBP400 million. Following the acquisition of Walney, borrowings under Greencoat UK Wind's acquisition facility will amount to GBP380 million, bringing total borrowings to GBP980 million.
SSE noted the cash proceeds from the deal will support its GBP7.5 billion five-year capital expenditure plans to invest in core strategic assets that will support the ongoing transition to net zero emissions.
SSE Finance Director Gregor Alexander said: "Walney has been a good financial investment for SSE but we see it as a non-core asset as we are not the principal operator. This transaction is a key first step in our GBP2 billion asset disposal programme announced in June and will enable SSE to build out its GBP7.5 billion low carbon investment programme over the next five years, helping the UK to reach net zero emissions, stimulating a green economic recovery and creating value for shareholders and society."
Greencoat UK Wind Chair Shonaid Jemmett-Page added: "We are delighted to acquire SSE's 25% interest in Walney, which is a high quality, ROC accredited asset. The acquisition is our third offshore wind farm investment since listing in 2013, following our investments in Rhyl Flats and North Hoyle. Walney is a natural addition to our portfolio of operating UK wind farms and increases our net generating capacity to over 1 gigawatts for the first time."
Shares in SSE was 0.2% lower in London on Tuesday at 1,256.22 pence each. Greencoat UK Wind was 1.1% lower at 141.80p.
By Paul McGowan; paulmcgowan@alliancenews.com
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