Erbud's renewables builder Onde plans Warsaw IPO and green growth

Wind turbines in Poland. Image by: European Bank for Reconstruction and Development (EBRD).

Polish construction group Erbud SA (WSE:ERB) announced on Monday that its renewables-focused unit Onde SA plans to carry out an initial public offering (IPO) on the Warsaw Stock Exchange (WSE).

Depending on market conditions, Onde intends to issue no more than 8.25 million new shares, while existing shareholders, Erbud itself and board vice president Jacek Leczkowski, will offer no more than 8.85 million shares. 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 book-building process is planned to take place at the end of June or in early July. The prospectus for the offering will be made available to the public once it is greenlit by the Polish Financial Supervision Authority.

Onde 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 (USD 157m/EUR 129.5m) 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 with a planned capacity of about 458 MW and is negotiating a further 734 MW of project purchases for which it has letters of intent in place. The proceeds from the IPO will help facilitate this expansion.

(PLN 1.0 = USD 0.268/EUR 0.221)

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