NextEra Energy Partners is to upsize its convertible equity portfolio with investor KKR by $150m (€123m), with funds to be used to acquire renewables projects.
Under the terms of the amended agreement, together with other minor modifications around the timing of buyouts over time, NextEra Energy Partners will receive an incremental $150m as part of the second draw of the financing, which is expected to occur by the end of the second quarter of 2021.
The second draw is now expected to total approximately $500m, bringing the total expected proceeds from the 10-year convertible equity portfolio financing agreement to approximately $1.25bn.
Proceeds from the second draw are expected to be used to partially fund NextEra Energy Partners’ previously announced planned acquisition of approximately 400MW of operating wind assets.
Following the second draw of the financing, the investor will receive 25% of the cash distributions from the underlying portfolio.
NextEra Energy Partners chief executive Jim Robo said: “The agreement announced today demonstrates the continued robust private infrastructure demand for the high-quality assets in NextEra Energy Partners’ portfolio and our strong continued relationship with KKR, which is providing us with an attractive low-cost source of capital.
“This is a terrific source of capital for NextEra Energy Partners and supports funding for the acquisition of the previously announced 400-MW portfolio of wind projects.
“In addition, the upsizing of what is the lowest-cost and longest-dated convertible equity portfolio financing in the partnership’s history is expected to provide significant benefits for unitholders.
“We continue to believe that NextEra Energy Partners is uniquely positioned to take advantage of the disruptive factors reshaping the energy industry, meet its long-term growth objectives and deliver unit holder value going forward.”