London-listed energy group Parkmead is entering the renewables sector with the acquisition of Pitreadie Farm, which has land in Scotland with “significant” clean power development potential.
The acquisition comprises £4.9m payable in new Parkmead shares, alongside the adoption of an existing £3.6m loan from Bank of Scotland.
Parkmead said potential has been identified for the installation of numerous wind turbines, a solar farm and a biomass production facility on the acquired land, which totals some 939 hectares in Aberdeenshire.
One 501-hectare site is adjacent to the operational Mid Hill wind farm were average wind speeds are between seven to 10 metres per second, the company said.
It added that woodland planting has already been undertaken on part of this site, which has the potential for a commercial biomass supply operation.
Parkmead said it will be conducting a detailed analysis for optimising the land use of the various sites within the Pitreadie portfolio.
“The renewables sector is a natural expansion of Parkmead’s energy operations and is fully in line with the group’s strategy to increase the balance of Parkmead’s portfolio,” the company said.
The acquisition remains subject to the standard completion conditions and a further announcement will be made in due course, Parkmead said.
Parkmead independent non-executive directors Philip Dayer and Iain Rawlinson said: “This acquisition is directly in line with Parkmead’s strategy.
“It positions the group very well for balanced growth by making a first step into the renewables sector. These assets have significant onshore wind energy potential.
“There is an active market for land assets in Scotland, particularly those with renewable energy potential.”
Parkmead chief financial officer Ryan Stroulger said: “We are delighted to have secured this exciting opportunity in line with Parkmead’s strategy.
“The acquisition strengthens the group by adding quality assets with very significant renewable energy potential.
“Renewable energy is an area of major opportunity for us and, with our strong in-house technical and commercial expertise, Parkmead is very well positioned to benefit from this acquisition.
“The acquisition is complementary to Parkmead’s other business areas, broadening and enhancing the Group’s asset base and revenue stream.
“The team at Parkmead is working intensively to evaluate and execute further value-adding opportunities, which could provide additional upside to the company.”
Parkmead comprises of four business areas – Netherlands gas, UK oil and gas, performance benchmarking and economics and future opportunities.