Norwegian renewable energy solutions firm Scatec ASA has signed an agreement to sell a 42% stake in its solar plant in Upington for R949 million to investment firm Stanlib.
Scatec announced the multimillion-rand deal yesterday, saying it was sealed with a subsidiary of Stanlib Infrastructure Fund II, managed by Stanlib Asset Management.
The company’s 258MW Upington solar power plant in which Stanlib will have a stake, is one the plants awarded in the fourth bidding round under the Renewable Energy Independent Power Producer Programme and reached commercial operation in 2020.
Collectively, Scatec says, the plants in Upington generate approximately one-third of the proportionate power production EBITDA in South Africa for the company.
Jan Fourie, Scatec executive vice-president, Sub-Saharan Africa, comments: “We are excited about this positive change for Scatec. We are proud to enter into a transaction with a reputable South African partner such as Stanlib – this demonstrates a maturity for the South African renewable energy industry.
“It also supports our ambitions to invest in South Africa’s future and move the country’s energy and climate goals forward.
“Since Scatec will continue to provide asset management services to the project companies, this means our asset management and sustainability teams will continue to invest in skills development, career development and SME opportunities in the broader Upington region.
“We will also continue our local partnerships that help us make a difference in surrounding communities.”
According to Fourie, Scatec is a long-term player, and is invested in expedited investment and establishment of renewable energy solutions globally (and locally).
“This transaction does not indicate an exit for Scatec, but a strengthening of our local and regional position. With the capital raised, we will be able to support and further drive our ambitions and projects in South Africa – and the broader Sub-Saharan Africa region.”
Scatec CEO Terje Pilskog adds: “Today’s transaction is in line with our strategy to optimise our portfolio as presented at our capital markets update in September 2022, and will release capital for new investments in renewable energy.
“We are very pleased to secure a value-accretive transaction and are confident Stanlib will be a solid owner of the asset going forward.
“We entered South Africa back in 2010 and have since grown into a leading renewable energy player in the country. South Africa remains a focus market for us, and we will continue to build scale through new investments, including the Kenhardt project under construction and the new Grootfontein project secured in the fifth bidding round.”
The Scatec and Stanlib deal comes as SA, the continent’s most advanced economy, is experiencing severe power cuts.
Eskom, which supplies over 90% of SA’s electricity, is facing financial crisis and is struggling to maintain a steady power supply, most recently increasing load-shedding to stage six.
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