Tilt has sold Snowtown 2 for $1.07b Enterprise Value, which...

Tilt has sold Snowtown 2 for $1.07b Enterprise Value, which includes debt.

From Renew Economy, excepts:


"Listed renewable energy company Tilt Renewables has secured the sale of the 270MW Snowtown 2 wind farm in South Australia for the surprisingly high price of $1.07 billion in the biggest single transaction of its type in the country.The sale to Palisade Investment Partners Limited and First State Super follows the start of a “strategic” review launched in June by Tilt which was looking to free up capital for a raft of new investment opportunities in Australia for wind, solar and battery storage projects.

"The deal will see the sale of shares in the Snowtown 2 project worth $472 million, with another $611 million coming in the form of debt that was recently re-financed by Tilt, which also freed up some $86 million in capital thanks to the more generous terms. A sale price of around $800 million had been anticipated.Snowtown 2 was commissioned in 2014 and has a long term power purchase contract with Origin Energy until 2030, with a five year option after that. There is a potential for a solar farm to be added as well.

It is the fourth largest wind farm in the country and this deal is the largest single transaction in the country – although the 420MW Macarthur wind farm has also recently changed hands, albeit in 50 per cent tranches.

https://reneweconomy.com.au/tilt-lands-1-billion-deal-for-sale-of-snowtown-2-wind-farm-37120/?fbclid=IwAR0nU3BXIxB9N8ZVZuqiLxI_Jvj46JKGzuBh_TcL-frfz1sIuqwlJEQRu3k

_________

Ash here.

That is a very fancy price indeed. There appears abundant capital available for wind farms - deemed to be fashion assets. IFN has the option to sell or JV any of its wind assets while retaining despatch rights through a power purchase agreement. Capital could be redeployed to build new, more efficient and productive wind farms.

I don't see IFN as capital constrained and think it capable of funding eg Flyers Creek on current cash flows and balance sheet.

The point is, RR & team have more cards in their hand, more options, than is commonly recognised. We retail holders cannot know what future steps they are brewing up in the board room, but I expect big ambitions. The electricity generating market is horrendously complex and fluid. Anyone extrapolating current trends too far ahead is, ahem, brave, A misstep now could have serious consequences; get it right and prosperity will follow.

Ash