A month after closing its renewables-themed asset-swap with rival E.on SE, German energy major RWE has agreed to purchase 2.7-GW onshore wind and solar project development pipeline from the Nordex Group. The wind turbine manufacturers has agreed to sell the project development pipeline for $474 million. According to sources, these projects are located in Spain, France, Poland, and Sweden. The deal is anticipated to close in the last quarter of this year.
The acquisition will add to RWE’s current 22 GW renewable development pipeline. The project developer has stated that the acquisition will strengthen the company’s leading position, especially in France where Nordex’s project pipeline consists of around 0.1 GW of solar PV projects. Speaking on which, Anja-Isabel Dotzenrath, CEO at RWE Renewables said in a statement that the transition is in line with the company’s growth ambitions in France in fields of onshore, offshore wind as well as large solar energy plants and battery storage.
RWE noted that about 15 per cent of the entire pipeline is close to final investment decisions (FID) or in advanced development stages, while some 230 MW have contracts for difference (CfDs) or similar feed-in tariffs (FiTs) in place.
Nordex has been developing its own portfolio of wind energy projects. These projects are then sold to investors or customers. José Luis Blanco, CEO of Nordex said in the statement that the top-notch quality of underlying assets and the company’s continuous development track record have resulted in a strong interest in its project development pipeline from several market players crystallizing an exceptional outcome for the company. He added substantial proceeds generated from this transaction would strengthen Nordex’s balance sheet as the company continue to develop on its strong order book and tap lucrative market opportunities with its product portfolio.
The transaction concerns a team of over 70 employees, whose transfer to RWE Renewables is subject to a customary consultation process. Nordex has stated that the sale of the pipeline is also pending certain foreign investment clearances in France and that completion is scheduled for the final quarter of the year. Rothschild & Co served as an exclusive financial adviser to Nordex.
REGlobal’s Views: Nordex’s approach of developing solar and wind pipeline while also securing power offtake agreements for these projects is a win-win proposition for IPPs and OEMs. Under this model, OEMs can develop a stable pipeline of projects as per their production capacity while IPPs can strategically build their project portfolio without investing in auction procedures or negotiating FiT contracts.