US Solar Fund has announced that MN8 Energy, formerly known as Goldman Sachs Renewable Power, has exercised its purchase option over USF’s 50% interest in the 200MW DC Mount Signal 2 (MS2) solar farm.
The option gives MN8 the right to acquire USF’s 50% interest in MS2 for US$52.2m excluding working capital plus a non-refundable option fee of $1m.
USF’s total proceeds of $53.2m are consistent with the last published net asset value for MS2 prior to the grant of the option.
The MS2 sale will imply a gross return of approximately 11% per annum since USF announced the agreement to acquire up to 50% of MS2 from New Energy Solar in December 2020.
USF expects to execute binding sale documents in the first quarter of 2023, with financial close in the second quarter of 2023 subject to customary regulatory and financier consents.
The option exercise and expected resultant MS2 sale has no impact on the Strategic Review and Formal Sale Process (Strategic Review) announced on 17 October, 2022.
DC Mount Signal 2 is a solar farm based in southern California. Its entire output is sold to Southern California Edison under a 20-year PPA that started in June 2020.