Greenko’s Equity Raise, Acquisition Credit Positive, says Moody’s Report

Greenko will acquire Orange Renewables Singapore for a total enterprise value of approximately USD 922 million, which has 907 MW of solar and wind assets and pipeline assets of over 500 MW.

Backing the renewable energy company’s buyout move, credit rating agency Moody’s Investors Service in its report said that, the acquisition of Orange Renewables Singapore in USD 922 million by Greenko Energy Holdings (GEH) and it’s additional equity raise of USD 447 million from the shareholders is a major positive for the clean energy company.

According to the Moody’s report, “GEH’s credit profile will benefit from the cash-flow-generating ability of Orange Renewables assets and the continued demonstration of shareholder commitment and support. The acquisition confirms GEH’s expansion ambitions, which will entail execution risk and funding needs.”

Greenko will acquire Orange Renewables Singapore for a total enterprise value of approximately USD 922 million, which has 907 MW of solar and wind assets and pipeline assets of over 500 MW.

The renewable energy firm has signed the agreements for a primary equity raising of USD 447 million from an affiliate of GIC and an entity that is ultimately wholly-owned by the Abu Dhabi Investment Authority (ADIA).

Further, GIC invested its share, being USD 316.1 million, while ADIA will invest the remaining USD 79.3 million and Greenko Ventures will invest USD 52 million. However, GIC continues to maintain their current majority shareholding.

The Moody’s report further stated that, the additional equity injection beyond the acquisition requirement demonstrates shareholders’ commitment to GEH.

“The shareholder equity injection reinforces our expectation that GEH’s ultimate shareholders, GIC, the Abu Dhabi Investment Authority and Greenko Ventures (held by the founders) will provide support to the Greenko group in case of need,” the report added.

Including the latest equity injection, the shareholders have so far injected USD 1.4 billion into GEH over the past three years to help finance the development and construction of GEH’s renewable energy portfolio.

In addition, the majority shareholder is closely involved in GEH’s strategy, risk management as well as corporate governance, Moody’s said.

Source: ET