Further Investment in Primary Energy
1 October 2021
SDCL Energy Efficiency Income Trust plc
("SEEIT" or the "Company")
Further Investment in Primary Energy
SEEIT, the first UK listed investment company of its kind to invest exclusively in the energy efficiency sector, has acquired the remaining 35% equity interest that it did not already own in Primary Energy, a portfolio of recycled energy and cogeneration projects servicing the steel industry, located in Indiana, USA. The interest was acquired from a consortium led by Fortistar LLC for a cash consideration of approximately $92 million. The acquisition was identified as part of SEEIT's near term pipeline in its recent equity issue.
SEEIT acquired an initial 50% interest in Primary Energy in February 2020 and increased its stake to 65% in December 2020. Both the acquisition in December 2020 and the current acquisition were transacted under pre-agreed terms, ensuring the Company did not have to enter into a competitive auction process and helping to create additional value for SEEIT shareholders. Following the latest acquisition SEEIT is now the 100% owner of Primary Energy.
The 298MW portfolio consists of five individual operating projects which generate low-cost, efficient energy with substantial environmental benefits via three recycled energy projects, one natural gas combined heat and power project and a 50% interest in an industrial process efficiency project. The strong environmental benefits of the assets qualify the projects for Renewable Energy Certificates which are equivalent to those generated by 536 MW of solar or 374 MW of wind projects.
The portfolio of projects is located within the Indiana Harbor Works and involves two of the most efficient and advanced steel mills in the United States. Four of the five projects relate to steel mills that are owned by Cleveland-Cliffs Inc., the largest flat-rolled steel producer as well as the largest iron ore pellet producer in North America. The remaining project services Midwest Steel, a subsidiary of United States Steel Corporation. The projects are fully integrated into the steel mill facilities, including fuel handling and emissions control equipment and systems that are critical for the operation of the facilities.
Jonathan Maxwell, CEO of Sustainable Development Capital LLP, said: "We are pleased that SEEIT has successfully secured a 100% interest in Primary Energy, which plays an important role in SEEIT's portfolio with robust ESG credentials. It provides critical and cost-effective low carbon energy services to the steel industry, which is one the world's largest sources of greenhouse gas emissions.
The investment supports SEEIT's total return objectives and its progressive dividend policy. Completion of the acquisition follows a period of strong growth and diversification in SEEIT's overall portfolio."
For Further Information
|
Sustainable Development Capital LLP Jonathan Maxwell Purvi Sapre Eugene Kinghorn Tom Hovanessian
|
T: +44 (0) 20 7287 7700
|
|
Jefferies International Limited Tom Yeadon Gaudi Le Roux Neil Winward
|
T: +44 (0) 20 7029 8000
|
|
TB Cardew Ed Orlebar Joe McGregor |
T: +44 (0) 20 7930 0777 M: +44 (0) 7738 724 630 |
About SEEIT
SDCL Energy Efficiency Income Trust plc is a FTSE 250 constituent company and the first of its kind to invest exclusively in the energy efficiency sector. Its projects are primarily located in the UK, Europe and North America and include, inter alia, a portfolio of cogeneration assets in Spain, a portfolio of commercial and industrial solar and storage projects in the United States, a regulated gas distribution network in Sweden and a district energy system providing essential and efficient utility services on one of the largest business parks in the United States.
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 £1.00 per Ordinary Share), with a stable dividend income, capital preservation and the opportunity for capital growth. The Company is targeting a dividend of 5.62p per share in respect of the financial year to 31 March 2022. SEEIT's last published NAV was 102.5p per share as at 31 March 2021.
Past performance cannot be relied on as a guide to future performance.
Further information can be found on the Company's website at www.seeitplc.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 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.
Further information can be found at www.sdclgroup.com .
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
Latest directors dealings
- 1 day ago Savannah Energy
- 1 day ago Buccaneer Energy PLC
- 1 day ago Savannah Energy
- 1 day ago Carclo
- 1 day ago Schroder Japan Growth Fund