Hexicon has signed a Sales and Purchase Agreement (SPA) to take full ownership of a 1125MW floating offshore wind joint venture in South Korea, from partner Shell.
Under the agreement, Hexicon will increase its stake in the project MunmuBaram from 20% to 100%, increasing its project portfolio by 900MW.
The MunmuBaram scheme, initiated by the joint venture Hexicon Korea in 2018, is planned off the coast of Ulsan City.
Hexion’s full ownership of the project is enabled through the support of Glennmont Partners.
The commitment in the agreement falls within the existing framework of Hexicon’s Glennmont loan facility.
The purchase price for the acquisition will be paid with a first down payment of $5m.
In addition, the SPA includes a profit-sharing arrangement of up to $50m over a three-year period.
In the event that Hexicon sells its shares in MunmuBaram, the size of the profit-sharing will depend on several parameters, including the timing and the net proceeds.
Hexicon has already started the process of setting the long-term ownership structure for MunmuBaram, as well as the process for government approvals to proceed with existing licenses.
In the short term, Hexicon will reallocate resources to optimise value in the project whilst working in close collaboration with Shell to ensure a smooth transition.
Once concluded, the Munmubaram scheme will represent 15% of Hexicon’s net portfolio in terms of megawatts (MW).
“South Korea continues to be a leading market with good conditions for the development of floating offshore wind. Through this transaction, South Korea remains a core market for Hexicon and strengthens our position as a leading global developer of floating offshore wind,” said Hexicon chief executive Marcus Thor.