© Copyright Acquisition International 2024 - All Rights Reserved.

Article Image - Offshore Wind Attracting a Variety of Investor Groups
Posted 12th October 2015

Offshore Wind Attracting a Variety of Investor Groups

The wide range of investment entry points in offshore wind has attracted a diversified group of investors that span from strategic industrial players to passive financial investors. We spoke to Christine Brockwell, Managing Director and Head of Corporate Development at Global Capital Finance, who ga

Mouse Scroll AnimationScroll to keep reading

Let us help promote your business to a wider following.

Offshore Wind Attracting a Variety of Investor Groups

Offshore Wind Attracting a Variety of Investor Groups

Image

The wide range of investment entry points in offshore wind has attracted a diversified group of investors that span from strategic industrial players to passive financial investors. We spoke to Christine Brockwell, Managing Director and Head of Corporate Development at Global Capital Finance, who gave us the inside track on the exciting investment opportunities available in this sector.

Financial investors seeking cash yield are increasingly turning to renewables to meet their investment objectives. And, for large investors, offshore wind is one of the most attractive.

Offshore wind offers an opportunity for significant investment size — upwards of €250m — through a single asset, and often with far less deal complexity than is inherent in comparable size portfolio deals. Institutional investors will also find that offshore wind is an established market that is making significant strides towards maturity through cost reduction initiatives such as the commercialisation of larger wind turbines.

PGGM (Walney 1&2, Baltic 2) and PKA (Butendiek, Gode Wind 2) are two of the more active institutional investors in offshore wind that have successfully closed transactions during the construction phase of the project lifecycle.

Construction stage investments come in all shapes and sizes. Some offshore wind project sponsors see value in forming partnerships with financial investors to share the construction risk, and others prefer to take the construction risk while sharing the construction cost for a higher sales price premium. In the latter case, the sponsor takes responsibility for cost overruns while the financial investor makes stage payments through the construction phase.

The market has seen a variety of deal structures such as forward-purchase agreements, fixed-cost schedules and EPC wraps developed by parties that find it mutually beneficial to participate during the construction phase but do not necessarily want to share all the risk.

Investors willing to take on more risk for strategic reasons are also increasingly more active in the sector. Independent power producer Northland Power (Gemini, Nordsee 1,2,3) invested during the development stage to have contractual influence and Japanese trading house Marubeni (Westermost Rough) invested relatively early to gain sector know-how that will give them a competitive edge when Japan’s offshore wind market takes off.

The European market has more than ten projects where construction is due to start during the next few years. The main sponsors of these opportunities include Dong Energy and ScottishPower Renewables. The general market understanding is that these parties seek partners through considerably different deal structures.

Operating asset transactions are generally more straightforward and center on PPA and O&M structures, terms and conditions. For the more conservative financial investors active in the UK, route-to-market PPAs with caps and floors have been struck, while others have chosen to take electricity price risk and forego a floor price. Given the multiple entry points for investment, there is a steady stream of opportunities coming from this niche market within the renewables space. Now that the Netherlands, Belgium and France are gaining momentum, the market has never offered more opportunity.

There is not ‘one’ structure that developers consistently use. Offshore wind is a small enough market that serious investors can meet with the key offshore wind developers to help shape the offering toward a preferred structure.

Categories: Finance


You Might Also Like
Read Full PostRead - Eye Icon
All Your Currency – In Our Superapp!
News
15/06/2023All Your Currency – In Our Superapp!

Sydney-based company Bano SuperApp (Bano) allows customers to spend, pay, save, and invest, all from one virtual account. Designed for millennial and gen-z clients, the Bano superapp features a range of local, and global, financial offerings on one integrated

Read Full PostRead - Eye Icon
Tesco Mobile Partners with Crisis to Bring ‘Lifeline’ Of Connectivity to People Experiencing Homelessness in Great Britain
Strategy
26/08/2020Tesco Mobile Partners with Crisis to Bring ‘Lifeline’ Of Connectivity to People Experiencing Homelessness in Great Britain

Tesco Mobile has announced the start of an ambitious two-year partnership with Crisis with the aim of helping thousands of people experiencing homelessness across Britain to reconnect with society.

Read Full PostRead - Eye Icon
The Italian  Artificial Intelligence Startup Factory: Creating Startups Through Innovation
Innovation
29/07/2022The Italian Artificial Intelligence Startup Factory: Creating Startups Through Innovation

Established in 2020 ago in Milan, Italy, FoolFarm Spa has been recognised as the Leading Artificial Intelligence Venture Builder and is the leading European venture studio in the AI blockchain and cybersecurity sectors.

Read Full PostRead - Eye Icon
Is It Worth Investing In Trademarks When Expanding Your Business Globally?
News
16/12/2022Is It Worth Investing In Trademarks When Expanding Your Business Globally?

Most business owners want to ensure that their products resonate with their local consumers before expanding globally. If your product or service has become a success and you know there is a market outside Canada, going global is a good idea. 

Read Full PostRead - Eye Icon
Quick off the Mark: Intuit Inc Acquires KDK Softwares Private Limited
Innovation
25/03/2015Quick off the Mark: Intuit Inc Acquires KDK Softwares Private Limited

Intuit Inc. is a software company that develops financial and tax preparation software and related services for small businesses, accountants and individuals. We spoke to Nikhil Arora, Vice President and Managing Director at Intuit India, on the landmark deal

Read Full PostRead - Eye Icon
Japan Post Acquisition of Toll Holdings
M&A
27/02/2015Japan Post Acquisition of Toll Holdings

Japan Post Acquisition of Toll Holdings Toll Holdings Limited (Toll) announced that it has entered into a Scheme Implementation Deed (SID) with Japan Post Co. Ltd (Japan Post) under which it is proposed that Japan Post will acquire all of the Toll shares by wa

Read Full PostRead - Eye Icon
Innovative Bites Acquires Hancocks
M&A
13/04/2017Innovative Bites Acquires Hancocks

Confectionery powerhouse Innovative Bites has today, Wednesday 12 April 2017, acquired Hancocks Holdings, the UK’s leading supplier of wholesale sweets, from H2 Equity Partners and management.

Read Full PostRead - Eye Icon
Law Firms and Cyber Security: The 4 Most Common Cyber Threats
Legal
28/09/2020Law Firms and Cyber Security: The 4 Most Common Cyber Threats

Data breaches are becoming more prevalent and the legal sector is a favoured target and is falling victim to cyber-attacks at an alarming rate. Guy Lloyd at CySure explains the 4 most common cyber threats and why the legal sector should step up its focus on cy

Read Full PostRead - Eye Icon
How Multilingual Support Enhances Business Continuity and Crisis Management
News
20/05/2024How Multilingual Support Enhances Business Continuity and Crisis Management

Even in everyday circumstances, effective communication is a base level requirement for businesses operating worldwide. So when crises occur, it’s doubly important to maintain this minimum standard. This is where multilingual enters the picture, forming



Our Trusted Brands

Acquisition International is a flagship brand of AI Global Media. AI Global Media is a B2B enterprise and are committed to creating engaging content allowing businesses to market their services to a larger global audience. We have 14 unique brands, each of which serves a specific industry or region. Each brand covers the latest news in its sector and publishes a digital magazine and newsletter which is read by a global audience.

Arrow