Investment in portfolio of energy efficiency loans
09 September 2019
SDCL Energy Efficiency Income Trust plc
("SEEIT" or the "Company")
New investment in a portfolio of energy efficiency loans in the US
SDCL Energy Efficiency Income Trust plc, the first UK-listed investment company of its kind to invest exclusively in the energy efficiency sector, is pleased to announce a $22 million investment, structured as a portfolio of secured senior and subordinated loans, into a widely diversified portfolio of contracts (the ''Portfolio''). The Portfolio comprises a portfolio of loans, leases and subscription agreements relating to energy systems outsourcing and energy efficiency projects located across the USA, which have been developed by Sparkfund, a US-based energy systems-as-a-service company.
Sparkfund delivers energy systems-as-a-service to commercial and industrial buildings through a network of US-based and global energy companies. Energy systems-as-a-service is provided through a subscription model, with customers benefiting from reduced costs, improved comfort and reliability.
The Portfolio, which is managed by Sparkfund, is well diversified and is structured to provide predictable, stable and fully contracted cash flows. These individual agreements with customers have been aggregated with back-to-back funding provided by third parties. These existing lending arrangements are being refinanced by SEEIT's investment. The substantial majority of SEEIT's investment is senior debt relating to the underlying Portfolio of energy systems projects, with energy saving technology under management including LED lighting, HVAC, backup generators, and monitoring and controls. The balance of SEEIT's investment represents subordinated loans supported by the Portfolio.
The investment will be funded from SEEIT's existing cash reserves. Returns from the Portfolio are in line with SEEIT's total returns targets and supports its stated dividend policy.
SDCL continues to review an identified pipeline of investment opportunities for SEEIT, a number of which are at an advanced stage.
Commenting on the acquisition, Jonathan Maxwell, CEO and Founder of Sustainable Development Capital LLP, said:
"This represents SEEIT's second investment in the United States, which is an important and growing market for the strategy of the Company. This portfolio relates to a widely diversified series of projects delivering returns through subscription based and other energy systems delivery models.
Energy systems-as-a-service is a growing market and SEEIT is ideally placed to continue capitalising on this growth to deliver long-term, stable returns for shareholders."
For Further Information
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Sustainable Development Capital LLP Jonathan Maxwell Miles Alexander Keith Driver
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T: +44 (0) 20 7287 7700
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Jefferies International Limited Gary Gould Tom Hovanessian
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T: +44 (0) 20 7029 8000
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TB Cardew Ed Orlebar Joe McGregor |
T: +44 (0) 20 7930 0777 M: +44 (0) 7738 724 630 E: SEEIT@tbcardew.com |
About SEEIT
SDCL Energy Efficiency Income Trust plc is the first listed company of its kind to invest exclusively in the energy efficiency sector. Having raised £100 million gross proceeds in its London Stock Exchange IPO in December 2018, the Company acquired its seed portfolio later that month for a total cash commitment of £87 million. Examples of the projects in the seed portfolio include Combined Cooling/Heating and Power Plants at a Citi data centre and St Bartholomew's Hospital in London, as well as LED lighting projects for hundreds of Santander properties and over 100 NCP car parks in the UK. In addition, SEEIT announced on 7 March its first acquisition in the United States comprising a 71% interest in a high-quality portfolio of eight operating CHP projects for a total cash consideration of $5 million. On 19 June SEEIT announced it had entered into an agreement with Tesco plc for the installation, ownership, operation and maintenance of a portfolio of rooftop solar photovoltaic projects in the UK, which included a first phase of c.5 megawatts with additional solar projects scheduled under a framework agreement.
SEEIT 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.
SEEIT 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.
Further information can be found on the Company's website at www.sdcleeit.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 the group also operates worldwide from offices in New York, Dublin and Singapore. SDCL is authorised and regulated in the UK by the Financial Conduct Authority.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
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