The Renewables Infrastructure Group (TRIG) has sold a stake in the 330MW Gode offshore wind farm off Germany.
The investor has announced the sale of a 15.2% equity interest in the site for €100m at a 9% premium to carrying value to funds managed by Equitix Investment Management.
The deal is subject to clearances and consents.
TRIG will continue to own a 9.8% stake in the wind farm.
In February 2024 as part of the 2023 annual results, the TRIG board announced that it was prioritising the use of retained cash and proceeds from asset sales to reduce TRIG’s floating rate borrowings under the company’s revolving credit facility (RCF) to £150m during 2024.
Drawings under the RCF as at 30 June 2024 were £334m.
Proceeds from the sales of Pallas onshore wind farm (announced on 12 March 2024) and the 15.2% equity interest in Gode are expected to be received in the first half of 2024 and would reduce TRIG’s RCF borrowings to £195m.
TRIG chair Richard Morse said: “The disposals secured by the Managers both enhance TRIG’s NAV and create headroom for future growth.
“As part of our commitment to prudent capital allocation, the managers continue to appraise attractive investment opportunities, which include share buybacks, and progress selective disposals.
“Considering the company’s strong balance sheet and with the share price trading at a significant discount to the company’s NAV, TRIG’s shares represent a compelling investment opportunity.
“The board has therefore decided to commence a £50m share buyback programme, providing shareholders with immediate NAV per share accretion.”
TRIG adviser InfraRed’s Minesh Shah said: “We are pleased with the partial sale of our stake in Gode at a healthy premium to the most recent valuation.
“Over the past 12 months, we have successfully sold stakes in seven assets for a total of £210m.
“These sales were agreed at an average 11% premium above the assets’ respective valuations, which continues to underscore the disconnect between private and public market valuations for renewables infrastructure.”