Italian energy company Enel, through its subsidiary Enel Green Power has completed a deal of selling 80% of its stake in Mexican renewable portfolio of 1.8GW for $2.6bn.
The stake has been sold to Caisse de dépot et placement du Québec (CDPQ) and an investment vehicle of CKD Infraestructura México (CKD IM).
As part of the deal, Enel has sold its interest in eight special purposes vehicles (SPVs) which own the renewables portfolio, including fully operating three plants with capacity of 429MW, three recently-connected plants with a capacity 1.089GW and two projects under construction with a capacity of 300MW. The total capacity of these plants is 1.8GW.
Specifically, the portfolio includes nearly 1.1GW from the solar plants Villanueva I (469MW), Villanueva III (359MW) and Don José (260 MW) as well as about 0.7GW from the wind farms of Amistad (198MW), Dominica (200MW), Palo Alto (129MW), Salitrillos (103MW) and Vientos del Altiplano (100MW). These plants are supported by long-term power purchase agreements (PPAs).
Enel Green Power will continue to operate the plants owned by the SPVs and will complete those which are still under construction through two newly-formed subsidiaries.
Furthermore, EGP stated that it may contribute or transfer additional projects from 2020, increasing its indirect stake in the SPVs.
CDPQ is a long-term institutional investor and CKD IM is a Mexican pension funds. Through this transaction, EGP and CDPQ will own 20% and 40.8% stake in the SPVs, through a newly formed company Kino Holding and CKD IM will own 39.2% stake in the SPVs, through a newly formed Mini HoldCos.
The consideration of $2.6bn includes an equity value of about $300m, project financings account for about $800m and the related party loans amount to $1.5bn.
With this transaction, Enel aims to reduce its consolidated net debt by about $2.4bn.