Aquila European Renewables Income Fund (AERIF) has secured the rights to acquire Aalto Wind No 2 Ltd Oy, its fourth investment since its initial public offering (IPO) on the London Stock Exchange in May 2019.
Aalto Wind No 2 Ltd Oy is the holding entity for a Finnish wind farm, which AERIF now plans to purchase later this year by entering into a short-term financing agreement. The final consideration will amount to approximately 15.5 percent of the proceeds raised from the recent IPO.
Aalto Wind No 2 Ltd Oy holds both the li Olhava (Olhava) wind farm and its extension, li Olhava Extension (Olhava Ext) which is situated approximately 50 kilometres north of Oulu with an installed capacity of 34.55 MW and an expected production of 99.2 GWh p.a. The park consists of eight Vestas V112 and three Vestas V126 turbines with capacities between 3.1 and 3.3 MW.
The wind park qualifies for the Finnish feed-in tariff support scheme, which is structured as a contract-for-difference (CfD). Project Olhava is eligible for the CfD premium for approximately five more years, until mid to late 2024. The 9.9 MW Olhava Ext meanwhile, is eligible for approximately six more years until September 2025.
Aquila intends to conclude power purchase agreements (PPAs) as soon as market conditions and hedging solutions are feasible and considered attractive from a risk-adjusted point of view. It is also expected to enter into a GoO purchase agreement for up to five years to further hedge the market price exposure.
Commenting on the announcement, Christine Brockwell, senior investment manager at Aquila said: "A good blend of revenues from feed-in tariffs and power purchase agreements is a key element of the company`s balanced investment strategy. The planned acquisition is expected to make a strong contribution towards AERIF´s dividend objective and demonstrates our broad investment reach. With completion of the acquisition, the company will be 55.1 percent invested. We are looking forward to advising the board of directors on further investments in the near future."
