ASX-listed solar energy investor New Energy Solar this week told shareholders the sale process for the Beryl and Manildra solar power plants remains on track with an announcement of an outcome expected before the end of June.
“The asset sale process for NEW’s Australian assets, Beryl (110.9 MWdc) and Manildra (55.9 MWdc), is progressing well,” the company said in its March quarterly update.
“The indicative bid phase is complete and select parties are engaged in intensive due diligence and site visits. The process remains on schedule with completion anticipated by mid 2021.”
The sale has attracted interest from a range of investors, both domestic and international, with the Australian Financial Review reporting the shortlist includes Sydney’s Palisade Investment Partners (which recently acquired Granville Harbour Wind Farm in Tasmania), and Thailand’s Banpu which is advised by the Azure/Natixis partnership.
Melbourne-based Lighthouse Infrastructure, which has interests in Queensland’s Emerald Solar Park and Clare Solar Farm, and a rooftop PV portfolio is also listed among the contenders.
New Energy Solar, which is also active in the United States market with solar farms totalling more than 600 MWdc, flagged the sale of its Australian portfolio late last year after reporting a $74.3 million loss in 2020.
A strategic review conducted by RBC Capital Markets recommended the company’s exit from the Australian renewable energy market, having identified that New Energy Solar’s security price has been impeded in part by “limited support for the listed renewables sector in Australia”.
New Energy Solar CEO John Martin said at the time the US has a market that offers more favourable regulatory and market settings for renewable energy.
“We had hoped to build NEW’s Australian portfolio but acquiring quality assets with long-term PPAs is more difficult in Australia. We concluded that we would not be able to achieve a business of scale here.”
New Energy Solar told shareholders this week the policy and regulatory environment for renewables in Australia had again played a part as its portfolio had performed below the investment manager’s expectations in Q1 2021.
While the company said the performance was primarily due to fire damage at its Stanford Solar Plant in California, it said grid curtailment in NSW had also played a part.
New Energy Solar said that subject to completion, proceeds from the asset sale will be available for a range of capital management initiatives, which may include security buybacks, capital returns and debt reduction.
“Assuming the Australian asset sale concludes as expected, the boards intend to undertake capital management initiatives to restore value for investors,” the company said, adding the nature and size of the capital management initiatives will not be known until the sale process is complete.
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