TIDMSEIT
RNS Number : 5401Y
SDCL Energy Efficiency Income Tst
10 September 2020
10 September 2020
SDCL Energy Efficiency Income Trust plc
("SEEIT" or the "Company")
Acquisition of UK Energy Efficiency Portfolio and Corporate
Update
Acquisition of CHP projects from GET Solutions
SDCL Energy Efficiency Income Trust plc, the first UK-listed
investment company of its kind to invest exclusively in the energy
efficiency sector, today announces the acquisition of a portfolio
of energy efficiency projects in the UK from GET Solutions, a
leading UK energy solutions provider for businesses. The initial
cash consideration is approximately GBP5 million to be invested
over the next four months to acquire an initial portfolio, with an
estimated additional GBP12 million to acquire a follow-on pipeline
of projects in the UK over the next year.
The initial portfolio of 15 projects, comprises four operating
projects, two installed projects and nine ready to build projects.
The installed and ready to build projects are expected to be
operational within 4 months. The projects involve highly efficient
combined heat and power ("CHP") systems installed at Holiday Inn
and Crowne Plaza hotels, which are both brands of the
Intercontinental Hotel Group. The hotels are owned by a leading US
private equity group and are managed by Interstate Hotels and
Resorts, a leading hotel operator. There is a follow-on pipeline of
up to 51 highly efficient CHP projects in the UK hotel sector.
The projects have all been developed by GET Solutions, which has
served as a specialist provider of energy services to over 40,000
business clients over the last 20 years. The projects are installed
and maintained by 2G Energy, an internationally leading
manufacturer of CHP plants. The projects all meet the standards for
'good quality' or high efficiency CHP and help the hotels to reduce
carbon emissions as well as energy costs, consistent with SEEIT's
objectives to deliver solutions that are cheaper, cleaner and more
reliable.
The projects in the initial portfolio have been designed to
provide the base-load energy generation to meet the operational
needs of the hotels, irrespective of their levels of occupancy. The
contractual structure of the projects that has been negotiated with
GET Solutions results in predictable revenues with potential for
upside for SEEIT in the event that certain levels of consumption
are achieved. SEEIT is not taking development or energy price risk
and demand risk is substantially mitigated on the downside. SEEIT
will own the project assets that provide essential services to the
buildings throughout the 15-year life of the project contracts.
SEEIT also benefits from a package of performance and revenue
guarantees from GET Solutions as well as protective termination
provisions. GET Solutions will continue to provide operational
management to the projects during the operational phase.
SEEIT will also benefit from additional rights to invest in a
substantial pipeline of more than 100 energy efficiency
installations with GET Solutions in the UK. This pipeline involves
up to GBP30 million of investment in CHP, solar and storage
projects across multiple high-quality commercial and industrial
counterparties in the logistics, senior living and infrastructure
services sectors.
Increase in Revolving Credit Facility
In July the Company, through its subsidiary SEEIT Holdco
Limited, increased its Revolving Credit Facility ("RCF") with
Investec Bank plc from GBP25 million to GBP40 million on existing
terms. The RCF expires in June 2022 and includes an accordion
function for a further GBP25 million increase on an uncommitted
basis.
SDCL's CEO, Jonathan Maxwell, said:
"We are very pleased to have the opportunity to invest in a
portfolio of well-structured building energy efficiency solutions
in the UK that help to reduce greenhouse gas emissions, cut energy
costs, and improve the quality of infrastructure. We are
particularly pleased to have established a replicable energy
services offering, which involves zero up-front investment for
clients, with a partner such as GET Solutions and for such
prominent clients.
I am also delighted to announce that our Senior Adviser, Michael
Liebreich, has been appointed as an Official Adviser to the UK
Government Board of Trade. Michael is recognised as one of the
leading global experts on clean energy and his involvement with
SDCL allows our stakeholders to benefit from his wealth of
experience, connections and deep understanding of the sector. Since
our GBP110m fundraise in June, we have now committed GBP55 million
to new investments and are at advanced stages of negotiations on an
exciting and substantial pipeline of new investment opportunities
in the USA, Continental Europe and the UK. We look forward to
providing a further update. "
For Further Information
Sustainable Development Capital T: +44 (0) 20 7287 7700
LLP
Jonathan Maxwell
Purvi Sapre
Eugene Kinghorn
Keith Driver
Jefferies International Limited T: +44 (0) 20 7029 8000
Tom Yeadon
Gaudi le Roux
TB Cardew T: +44 (0) 20 7930 0777
Ed Orlebar M: +44 (0) 7738 724 630
Joe McGregor E: SEEIT@tbcardew.com
About SEEIT
SDCL Energy Efficiency Income Trust plc is the first UK listed
company of its kind to invest exclusively in the energy efficiency
sector. Since IPO, SEEIT has made seven investments and commitments
in a diversified portfolio of distributed generation and energy
efficiency projects totalling c.GBP375m. The projects are located
in the UK, Europe and North America in broadly equal proportions
and include, inter alia, a portfolio of cogeneration assets in
Spain, a portfolio of recycled energy and cogeneration projects in
the United States and, most recently, a commitment to acquire a
series of electric vehicle charging stations across the UK.
The Company aims to deliver shareholders value through its
investment in a diversified portfolio of energy efficiency projects
which are driven by the opportunity to deliver lower cost, cleaner
and more reliable energy solutions to end users of energy.
The Company is targeting an attractive total return for
shareholders of 7-8 per cent. per annum (net of fees and expenses
and by reference to the initial issue price of GBP1.00 per Ordinary
Share), with a stable dividend income, capital preservation and the
opportunity for capital growth. The Company is targeting a dividend
of 5.5p per share in respect of the financial year to 31 March
2021. SEEIT's last published NAV was 101.0p per share as at 31
March 2020.
Further information can be found on the Company's website at
www.sdcleeit.com.
Investment Manager
SEEIT's investment manager is Sustainable Development Capital
LLP ("SDCL"), an investment firm established in 2007, with a proven
track record of investment in energy efficiency and decentralised
generation projects in the UK, Continental Europe, North America
and Asia.
SDCL is headquartered in London and the group also operates
worldwide from offices in New York, Dublin, Madrid, Hong Kong and
Singapore. SDCL is authorised and regulated in the UK by the
Financial Conduct Authority.
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