London-based fund manager Glennmont Partners will acquire a 50% stake in Ørsted A/S’ (CPH:ORSTED) 900-MW Borkum Riffgrund 3 offshore wind farm complex in the German North Sea.
The value of the deal is estimated at roughly DKK 9 billion (USD 1.4bn/EUR 1.21bn), including the acquisition price and a commitment to fund 50% of the payments under the project’s engineering, procurement and construction (EPC) contract, Ørsted said on Tuesday.
Borkum Riffgrund 3 is planned to commence operations in 2025, depending on Ørsted's final investment decision, which the Danish wind power major expects to take by the end of this year. The wind farm will be installed off the coast of Germany close to Ørsted's Borkum Riffgrund 1 and Borkum Riffgrund 2 wind farms. The new plant will be powered by 11-MW Siemens Gamesa turbines.
Ørsted secured Borkum Riffgrund 3 in German auctions with a bid of EUR 0 per MWh. The Danish group will build the wind farm under a full-scope EPC contract and will also take care of its operations and maintenance (O&M) for 20 years. Additionally, it will provide a route to market for the power and green certificates generated by the complex. Power purchase agreements (PPAs) are already in place for 450 MW of the total capacity and additional contracts are in the pipeline.
Glennmont, part of global asset manager Nuveen, will partly fund the purchase and ongoing funding of its 50% share through a financing package structured and led by Ørsted. It has also obtained long-term senior debt facilities from eight banks.
Ørsted noted that the divestment depends on taking a final investment decision on Borkum Riffgrund 3, project permits and antitrust clearance. The deal is seen to be finalised in the last quarter of 2021 or the first trimester of 2022.
(DKK 1.0 = USD 0.156/EUR 0.134)
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