Aquila Euro. Regulatory News (AERI)

15 September 2021

Aquila European Renewables Income Fund plc - The Rock Bond Refinancing

Bond refinancing includes EUR 235 million US Private Placement & EUR 80 million Junior Nordic Green Bond

Aquila European Renewables Income Fund plc ("AERIF" or "the Company"), the London-listed investment company advised by Aquila Capital Investmentgesellschaft mbH, today announces that The Rock (the "Project", also known as "Øyfjellet Wind Farm"), a project in which the Company's wholly owned subsidiary holds a 13.7% interest, successfully closed a US Private Placement ("USPP") and Junior Nordic Green Bond ("Green Bond") (collectively the "Bond Refinancing").

The Bond Refinancing comprises a USPP of EUR 235 million and a Green Bond of EUR 80 million, representing a combined issuance amount of EUR 315 million (on a 100% interest basis). The USPP notes are rated investment grade and both bond issuances were oversubscribed.

On 10 June 2021, the Company announced it had increased its commitment to The Rock by up to EUR 35.6 million to provide bridge financing (the "Bridge") for the Project given that certain conditions under the Project's existing debt financing agreement prevented the draw-down of the senior debt in place (approximately EUR 323 million in total facility limits[1]). The proposed Bond Refinancing was pursued in order to allow the Project to immediately benefit from access to debt financing at attractive terms. The Bond Refinancing is expected to be accretive to the economic returns of the Project.

Proceeds from the Bond Refinancing will be used to fund remaining construction and other project costs, repay the Bridge provided by each of the Project shareholders and return surplus capital to the Project's shareholders. In connection with the Bond Refinancing, the Company (via its wholly owned subsidiary) expects to receive total proceeds of approximately EUR 23 million, comprising:

· Approximately EUR 19 million, representing the full repayment of the Bridge (principal drawn to date, plus accrued interest). Funds are expected to be received shortly; and

· Approximately EUR 4 million in surplus capital, which is expected to be paid over time during the remainder of the construction period.

Together with the Company's recently announced capital raising, proceeds from the Bond Refinancing will be used to repay any outstanding debt under its revolving credit facility (currently drawn to EUR 10 million), as well as funding the Company's attractive pipeline of investment opportunities.

The USPP has a tenor of 24 years and is fully amortising with a fixed rate of 2.12%, whilst the Green Bond is a bullet facility with a tenor of 5 years at a fixed rate of 2.75%. The Project is also expected to enter into long-dated forward interest rate swaps to mitigate future interest rate risks associated with the Green Bond. The USPP represents an extension of tenor by approximately 6 years compared to the existing bank debt in place at the Project.

The Green Bond was rated by the independent consultant CICERO Shades of Green ("CICERO"). The Company is pleased to announce that the Green Bond achieved a "Dark Green" rating and an "Excellent" rating for governance, both of which are the highest possible ratings under CICERO's framework. The favourable ratings reflect the Project's focus on best practice including Environmental Impact Assessments and transparent engagement with local stakeholders. A link to CICERO's report is available on the Company's website.

Ian Nolan, Chairman of the Company, commented: "We are pleased to announce the first debt capital markets issuance for AERIF via its investment in The Rock. In addition to the economic benefits associated with the refinancing, we are happy to have launched the Company's first green bond, further augmenting our participation in the green energy transition."

Commenting on today's announcement, Michael Anderson, Senior Manager at Aquila Capital, the investment adviser to AERIF said: "This is an important milestone for The Rock, the Aquila European Renewables Income Fund and Aquila Capital as the project advances closer toward completion. The refinancing was concluded at attractive terms and further diversifies the Company's sources of debt funding. We are very happy to see the transaction supported by such a high quality investor base."

Ends

For further details contact:

Media contacts:

Smithfield Consultants

Ged Brumby | 020 3047 2527

John Kiely | 020 3047 2538

Andrew McLagan | 020 3047 2006

Sponsor, Broker and Placing Agent

Numis Securities 020 7260 1000

Tod Davis

David Benda

Vicki Paine

NOTES

Aquila European Renewables Income Fund plc ("AERIF" or the "Company") is a London-listed renewable energy infrastructure investment company with the aim to provide investors with an attractive long-term, income-based return in EUR through a diversified portfolio of hydropower, onshore wind and solar PV investments across continental Europe and Ireland. Through the diversification of generation technologies, the seasonal production patterns of these asset types complete each other to balance the cash flow, while the geographic diversification serves to reduce exposure to one single energy market. AERIF is targeting 5.0 cents per ordinary share in relation to the financial year ending 31 December 2021, with the aim of increasing this dividend progressively over the medium term.

Further details can be found on AERIFs website at www.aquila-european-renewables-income-fund.com.