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– You will feel a little relieved when you have finally reached the finish line. We have worked hard all summer. It’s not like going to the store and buying bread, says Raymond Carlsen, senior manager and store owner at Scatec Solar.
Scatec Solar, which was founded by series founder Alf Bjørseth in 2007, is expanding solar power plants almost all over the world and has become a favorite on the stock market. Stock market values have doubled this year.
The company is now putting NOK 10.9 billion on the table for hydroelectric power producer SN Power.
Three attractive bidders
The seller is the state investment fund Norfund. SN Power as was initially owned by Statkraft and Norfund when it was established in 2013. Over the years, the company has developed hydropower in several developing countries in Africa and Asia. Now almost everything is sold to Scatec, and with a billion profit.
Norfund CEO Tellef Thorleifsson informs DN that they will post a profit of around NOK 6 billion, somewhat depending on the krone exchange rate. They will reinvest in new opportunities in renewable energy.
Thorleifsson explains that Norfund hired Nomura Securities as an advisor and started the process last spring, that is, a year and a half ago.
– We mainly target international players in Asia and Europe and analyze partial sales and higher sales. We spoke with financial and industrial players, says Thorleifsson, who first had a shortlist of 15 candidates.
– We ended up with three that had such attractive offers that we continued, he says.
Scatec Solar first went online, surprisingly, the Norfund boss admits, in March this year. Korona twisted the process when some withdrew due to funding and inspection of hydroelectric plants was made more difficult due to travel restrictions.
– It all ended with a competitive process, so we finally decided to go ahead with Scatec, says Thorleifsson, CEO of Norfund.
The parties began exclusive negotiations in July this year.
Sun, water, wind and battery
At the same time, Scatec Solar has decided to change its name to just Scatec. With the acquisition, Scatec will participate in the storage of solar, hydroelectric, wind and energy energy in much of the world. The merged company will have a total capacity of 3.3 gigawatts in production and under construction.
– It is completely natural for us to develop the technological spectrum to include water, solar, wind and batteries. From now on, it will be Scatec, Raymond Carlsen said at Friday’s press conference.
The IEA estimates that renewable energy will account for 80 percent of global electricity demand growth by 2030 in its standard scenario. Hydropower will continue to be the largest source of renewable energy, while solar power will be the largest engine for growth.
– What the IEA says is a report on their state of mind. They have been behind most of the time. I feel like they are still falling behind. According to my sources, we have reached the “peak of demand for oil.” We will not increase the demand for oil more than today. I think it will be relatively difficult for those who work in the oil and gas sector to keep up, says Carlsen.
Loans finance more
The acquisition is financed through a combination of cash, $ 200 million in seller credit from Norfund, a term loan and $ 700 million in acquisition financing from a pair of banks.
– The stock market is hot. Why don’t you use it?
– We had a stock issue in May, says Carlsen, who firstly says it was the right time and secondly that it is always wise to have some extra money in the account when cards are dealt in a different way than the crown. .
The issue then was around two billion crowns.
– We knew at the time that we were working to be in a position to buy SN Power. We have acquisition financing that covers us so we can implement the agreement. It will be refinanced with a combination of debt and equity, says Scatec’s CEO.
– Is it then in the letters that there will be an issue of shares?
– We will go back to that, but the financing of the acquisition has a duration of 12 months from the moment we close the transaction, he says.
Strong momentum of stocks
Scatec Solar’s share price jumped about 20 percent on Friday, pushing the power company’s market value to NOK 35.5 billion.
Equinor is the largest owner of the company with around 15 percent of the shares and received a paper gain of more than NOK 800 million from the price increase on Friday. Scatec Solar CEO Carlsen says Equinor was informed of the acquisition Thursday night.
As a shareholder, it is not natural for us to comment on individual transactions with Scatec, and we will refer to Scatec for information on their activity, says press contact Eskil Eriksen at Equinor, who says they have a long-term approach to the company’s investments. at Scatec Solar.
Norfund’s CEO is confident that SN Power is in good hands at Scatec.
– In the future, hydropower will be an important complement to solar and wind power and then it will be incredibly irrational of them not to develop the values further when they have bought it for 10.9 billion crowns, he says.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content may only be done with written permission or as permitted by law. For more terms, see here.
