MRP to set up capital-raising arm
Irish developer Mainstream Renewable Power (MRP) hopes to tap billions of euros of cheaper financing for its projects from pension funds and insurance companies through the launch of a new unit called Mainstream Capital.
Mainstream – one of the world’s most ambitious developers – said the capital-raising platform will woo investors seeking to benefit from “government-backed, long-term cash flows”.
Announcing the launch of Mainstream Capital in Dublin today, MRP CEO Eddie O’Connor said the company now had the scale and track record needed to make the move.
“We have built a credible business. When you get this big, there is an exercise in corporate branding in the sense that people know that we know what we’re doing. We have a great track record and our projects allow pension funds and insurance companies to take a sensible outlook over a 20-year period,” O’Connor said.
The MRP boss claimed the venture could make a big impact on its finance costs. “As the business has grown, the risk-adjusted return has moved from private equity towards long-term, stable infrastructure returns.”
MRP has interests in major wind and PV projects spanning Europe, South Africa, the US and Latin America.
Earlier this year Japanese conglomerate Marubeni bought a stake in MRP, which signalled its new partner would look to buy into some of its key projects.
The formation of Mainstream Capital chimes with a wider desire in the European renewables sector to attract pensions and insurers by stressing the guaranteed, low-risk returns projects can pull in once they are operational.
Some Danish pension funds and the German insurance giant Allianz are among those to have committed to renewables on a significant scale, but the industry wants to unlock billions more euros to meet the finance shortfall left by struggling utilities.