Wind acquisitions soar in 2013

Lukerg Renew, the Vienna-based joint venture owned by Russian oil company Lukoil and Italian wind developer ERG Renew, has already bought two wind farms this year.

Lukerg Renew, the Vienna-based joint venture owned by Russian oil company Lukoil and Italian wind developer ERG Renew, has already bought two wind farms this year.

Acquisition activity for wind farms leapt to its highest level since 2010 during the second quarter, with five buy-ins worth $1.3bn leading the way in a 36-project shopping spree across the global industry, according to consultancy Mercom Capital.

The largest deal by value was PG&E’s acquisition of Puget Sound Energy’s 267MW Lower Snake River phase II wind farm in the US for $535m, followed by SSE’s take-over of Scotland’s 99MW Dunmaglass project from RES for $305m.

Palisade and Northleaf’s joint purchase of a 75% stake in Australia’s 111MW Waterloo project from EnergyAustralia for $227m, Lukerg Renew buy-up of the 70MW Gebeleisis development in Romania from Vestas for $144m, and Denmark’s Pension Fund Administrator compatriot energy outfit SE’s take-over of Dong’s 196MW onshore wind business for $133m, were next in the acquisition table.

“The strong project acquisition activity shows how wind has evolved into a mature and mainstream energy source and an attractive investment for both private and public firms alike,” says Mercom chief executive Raj Prabhu, noting that most of the project acquirers this quarter were investment funds such as Allianz Capital Partners, which snapped up three projects this quarter, while Enel Green Power, John Laing and Lukerg Renew each bought-in to two.

There have been 53 project acquisitions in the year to date, compared to 72 in all of last year, according to Mercom figures.

Venture capitalist spending on wind also shot up in Q2 with some $210m flowing into sector companies, as compared to just $16m during the same period last year.

Indian developer ReNew Power attracted $135m from Goldman Sachs, which raised its total investment in the company to $385m, while NSL Renewable Power, another Indian company, bagged $60m from multiple investors.

In two smaller deals, French floating foundation designer Ideol raised $9.1m, and Romo Wind, a rotor technology company, took home $6.2m.

Large-scale project funding in Q2 was off-trend, however, with a total $3.2bn in 24 deals comparing badly with the $6.2bn spent on 29 deals in the previous quarter.

Merger and acquisition (M&A) activity, meanwhile, came in at $328m in Q2, topped by the take-over of Brazil’s Salus Fundos de Investimento em Participacoes by compatriot Copel for $128m.

Among other M&A highlights in the quarter, PNE purchased a 54% share in WKN from former shareholder Volker Friedrichsen Beteiligungs for $122m, Aksa Energy acquired a 93% stake in Kapidag Ruzgar Enerjisi Elektrik Uretim for $67m, and high altitude wind turbine developer Makani Power was bought by Google for an undisclosed amount.

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