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Gresham House sells another battery storage project to fund
2nd Nov 2020 14:21
(Sharecast News) - Alternative asset manager Gresham House has sold a further battery storage project to the Gresham House Energy Storage Fund on 30 October, it announced on Monday.
The AIM-traded firm said the 50MW battery-only project, located near Thurcroft, east of Rotherham, was sold for a total enterprise value of £32.5m, plus up to £0.75m of deferred contingent consideration.
It said it was one of the exclusive portfolio projects being developed by subsidiaries and associates of Gresham House for sale to GRID.
Gresham House, through its wholly owned subsidiary Gresham House Devco and associate Noriker Power, made £1.7m of equity and loan investments in the project.
The board said the investment would return an initial net gain on sale of about £1.8m after contractual and expected payments and transaction fees, of which £0.8m would be received in the next 12 months.
A further net deferred payment of up to £0.3m, which was conditional on performance, could be payable in up to 12 months' time.
The directors said the investment in the project was consistent with exceeding its 15% return on balance sheet capital threshold over the medium term.
After the sale, Gresham House said it had an exposure of £3.6m in the remaining battery storage development projects it had funded, which were in exclusivity with GRID, with a further 50MW disposal expected to complete during 2020.
Gresham House said it was continuing to build and develop a pipeline of projects that were expected to be transferred to GRID in 2020 and beyond.
"It is pleasing to see GRID's expansion continue with this acquisition, alongside the financial gain to Gresham House shareholders from the development capital investment," said chief executive officer Tony Dalwood.
"As previously demonstrated, we will use our balance sheet where appropriate to scale our long-term asset management capability in renewable infrastructure.
"This is another example of our ongoing commitment to investing in sustainable, resilient assets that deliver long-term value for our clients and exceed return hurdles for shareholders."
At 1009 GMT, shares in Gresham House were down 0.4% at 729.6p.
The AIM-traded firm said the 50MW battery-only project, located near Thurcroft, east of Rotherham, was sold for a total enterprise value of £32.5m, plus up to £0.75m of deferred contingent consideration.
It said it was one of the exclusive portfolio projects being developed by subsidiaries and associates of Gresham House for sale to GRID.
Gresham House, through its wholly owned subsidiary Gresham House Devco and associate Noriker Power, made £1.7m of equity and loan investments in the project.
The board said the investment would return an initial net gain on sale of about £1.8m after contractual and expected payments and transaction fees, of which £0.8m would be received in the next 12 months.
A further net deferred payment of up to £0.3m, which was conditional on performance, could be payable in up to 12 months' time.
The directors said the investment in the project was consistent with exceeding its 15% return on balance sheet capital threshold over the medium term.
After the sale, Gresham House said it had an exposure of £3.6m in the remaining battery storage development projects it had funded, which were in exclusivity with GRID, with a further 50MW disposal expected to complete during 2020.
Gresham House said it was continuing to build and develop a pipeline of projects that were expected to be transferred to GRID in 2020 and beyond.
"It is pleasing to see GRID's expansion continue with this acquisition, alongside the financial gain to Gresham House shareholders from the development capital investment," said chief executive officer Tony Dalwood.
"As previously demonstrated, we will use our balance sheet where appropriate to scale our long-term asset management capability in renewable infrastructure.
"This is another example of our ongoing commitment to investing in sustainable, resilient assets that deliver long-term value for our clients and exceed return hurdles for shareholders."
At 1009 GMT, shares in Gresham House were down 0.4% at 729.6p.