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Abu Dhabi state-backed clean energy company Masdar is to buy Spanish renewables group Saeta Yield from Brookfield at a $1.4bn valuation, its second big investment in the country’s green energy sector this year.
Masdar will invest Dh2.88bn ($780mn) to acquire Saeta from Brookfield’s renewables unit. The Abu Dhabi group is chasing an ambitious target, set in 2022, of owning at least 100 gigawatts of renewable energy capacity by 2030
With six years to go, its capacity is now more than 20GW, not including assets bought this year because some deals have not yet completed.
The deal announced on Tuesday is mostly for wind farms, as well as solar plants, in Spain and Portugal, with an operating capacity of 745 megawatts and a further 1.6GW planned for development.
It comes less than three months after Masdar agreed to invest €817mn in Spanish solar power plants belonging to Endesa, a subsidiary of Italian energy group Enel.
“This deal consolidates our footprint in the Iberian market,” said Masdar chief executive Mohamed Jameel Al Ramahi.
Both of the deals require foreign investment approval from authorities in Spain and Portugal.
Masdar’s Saeta acquisition is the latest example of Gulf investment in Spain, which has generated a mix of enthusiasm and unease.
More than 12 months after Saudi Arabia’s Saudi Telecom Company bought a 4.9 per cent stake in Telefónica, one of Spain’s biggest companies, the government is yet to rule on whether it will allow STC to increase its stake to 9.9 per cent.
Earlier this year, Abu Dhabi energy group Taqa abandoned takeover talks for Spanish energy company Naturgy.
There have been a lot of Spanish renewables deals in the past few years: the country has a good climate for wind and solar power and the government is eager to support its development. By 2030, Spain wants to generate 81 per cent of its electricity from renewables.
The sector appeals to energy companies and also to institutional investors and private equity groups because of the promise of steady returns from power purchase deals, and the prospect of reselling assets at a higher price further into the future.
But renewables projects are not as profitable as they once were. Investor interest has driven up prices and pushed down returns, while electricity prices have fallen from the record highs they hit after Russia’s full-scale invasion of Ukraine in 2022.
Brookfield took Saeta private in 2018, and began looking for a buyer late last year, according to documents seen by the Financial Times.
Masdar’s backers include Taqa, Abu Dhabi’s national oil company Adnoc and its sovereign investor Mubadala.
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