Tuesday 21 November 2017

Egm shareholders give the go-ahead to NTR demerger

NTR boss Rosheen McGuckian
NTR boss Rosheen McGuckian
Gavin McLoughlin

Gavin McLoughlin

Wind energy company NTR has secured shareholder approval for a demerger of its European wind business and is in exclusive talks to buy a total of 50 MW of new assets across Ireland and the UK.

The company is in the process of a fundraising round and now expects to raise €120m in equity, rather than €100m as previously indicated.

That would bring its warchest including equity and debt to €455m, chief executive Rosheen McGuckian said.

"It gives us an opportunity to acquire more windfarms. Our plan was about 170 MW, that's now maybe 190MW of wind projects. Obviously that enables us to raise more debt as well," she told reporters.

"We like these projects because they deliver long-term attractive yields on our invested capital," Ms McGuckian added.

"Our target is to deliver just under 13pc cash yields annually over the life of the projects." Ms McGuckian would not reveal any more details about the assets the company is in talks to buy.

Under the demerger, which is still conditional on High Court approval, shareholders in the old NTR will be given the same number of shares in the new company and will have the option to redeem the new company shares at €2.25 apiece - a total of potentially €219m.

That could rise to around €2.32 apiece, depending on whether the company receives a conditional payment relating to solar projects sold by the company in 2011 before the demerger becomes effective.

The shareholder support for the proposals paves the way for the Group to apply to the High Court for approval of the merger. NTR is expected to apply to the High Court in the coming weeks.

Environmental services and plastics business One51 and Pageant Holdings which together a third of the company, have said they will redeem their shares, meaning they will have no stake in the new NTR.

Dreamport, NTR's largest shareholder which is controlled by NTR chairman Tom Roche's Woodford Capital, will not participate in the redemption and hold on to its shares.

The assets not spun out into the new company will remain in a company named Altas Investments, which will have a new board and management team.

The new company will retain the name NTR - a legacy from its days as a toll roads business - and will be led by Ms McGuckian.

Toll road assets of the type on which the company was built will stay in the oldco. "Outside of Ireland people don't associate NTR with National Toll Roads, they associate it with the renewables business... so on that basis we said it would be right to keep the name." Ms McGuckian said Altas will be "managed in the medium term".

"I wouldn't use the term 'wound down', it's about ensuring that the right value comes from the assets that are in play. It's not a growth vehicle, but it's about gettingthe value over the mid term. No intentions to acquirwe anything new.

"There are a number of potential receivables that could come in for years to come, so that doesn't necessarily mean to say that it will be wound down, but that's for the board of Altas Investments to decide," Ms McGuckian added.

NTR intended to call the company Altas but was told by the Companies Registration Office that this name was not available - a separate shareholder vote on the name will take place next month.

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