IIF buys up 75pc stake in Viridian for about €150m
Deal is first for infrastructure fund
THE Irish Infrastructure Fund (IIF) has announced its acquisition of a 75pc stake in Viridian, the Irish wind energy operator, at a price which sources close to the deal have estimated at €150m.
The deal covers €80m worth of Viridian debt as well as the portfolio of 104 megawatt (MW) of capacity generated by 10 wind farms, eight of which are located in the Republic with the other two north of the Border.
The fund will hold a stake of at least 75pc across the wind farms as a result of the transaction. Viridian's Energia business -- its retail arm -- will retain the minority interest and continue to manage the wind farms and to offtake substantially all of the electricity generated by them.
The deal is significant as the first ever by the IIF -- the investment vehicle set up last year with funding from the National Pensions Reserve Fund (NPRF) and other institutional interests to invest in Irish infrastructure.
IIF was set up by Irish Life Investment Managers and is run by international infrastructural fund managers AMP Capital.
The fund has a mandate to secure up to €1bn from global and institutional investors and channel it into significant Irish infrastructure assets, including those being disposed of by the State. Its biggest cash injection so far has been €300m from the NPRF.
AMP is advised by Macquarie Capital's Ireland office which was also engaged in recent transactions involving Quinn Insurance, NTR and SWS.
Industry sources say that the price of the Viridian deal represents particularly good value with Irish wind farm infrastructure selling for around €2m per megawatt.
Viridian is owned by the troubled Bahrain-based company Arcapita which is seeking to refinance €963m worth of debt in the bond markets.
Last year the Northern Ireland-based company sold NIE, its transmission and distribution business to the ESB for €1.4bn, also said to be a bargain price for the Republic's utility.
Peter Baillie, managing director of Energia Renewables, said the company looked to leveraging the investment through the continued growth and development of its portfolio of renewable assets across Ireland.
"We have invested €200m to date and now have a 24pc market share of operational wind generation throughout Ireland under contract (500MW).
"Our most recent projects include Corkermore and Drumlough Hill wind farms in Donegal, Caherdowney in Cork and Crighshane and Church Hill in Tyrone."
NPRF commission chairman Paul Carty said: "This is an important first investment by the IIF, establishing it as a major new investor in Irish infrastructure and bringing liquidity to the market."