Erbud's Onde to raise up to USD 118m in Polish IPO

Polish construction group Erbud SA (WSE:ERB) announced on Friday that its renewables-focused unit Onde SA will raise up to PLN 444.5 million (USD 117.7m/EUR 98.6m) in its planned initial public offering (IPO) in Warsaw.

Onde will issue nearly 17.1 million shares, including 8.25 million new and 8.85 million existing units. If all are issued, the offered shares will constitute 31.1% of the company’s share capital. Based on this, Erbud’s ownership interest will decline to 60.7% from 87.9%.

The transaction will value all of Onde at about PLN 1.4 billion, Erbud said as it published a prospectus for the offering. The sum assumes that all shares will be offered at the maximum price of PLN 26.00 apiece.

Onde intends to use the IPO proceeds to refinance, purchase and develop renewable energy plants for sale to investors. The company is a general contractor that serves the wind and solar power sectors in Poland. Based on data from the renewable energy auction in 2019, the firm had a share of more than 50% in the wind farm construction market and 10% in solar projects of up to 1 MW. It has finalised or is currently building almost 250 wind and solar parks totalling 2,800 MW.

In 2020, Onde generated PLN 586.3 million in revenues, up by 54% on the year, and recorded a 116% surge in earnings before interest, tax, depreciation and amortisation (EBITDA) to PLN 46.2 million. This year seems to be even stronger as in just the first quarter it generated almost 40% of its 2020 revenues, or PLN 229.6 million.

Now, Onde wants to do more in the renewables field, with plans to acquire, develop or co-develop, build and then sell large-scale projects. So far, the company has secured a portfolio of projects with a potential capacity of nearly 460 MW and has letters of intent regarding the acquisition and implementation of solar projects with a target installed capacity of between 500 MW and 700 MW.

(PLN 1.0 = USD 0.265/EUR 0.222)

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