Enel Green Power has sold a 49% stake in a newly-created renewable energy company in the form of a “yieldco” to GE Energy Financial Services for US$440 million.
Enel will continue to hold a 51% stake in EGPNA Renewable Energy Partners, which has a portfolio of 560 megawatts of North American wind, geothermal, hydropower and solar generation assets in operation, and an additional 200MW wind projects under construction.
Companies like First Solar, Canadian Solar and SunPower have formed “yieldcos” which typically provide power under long-term contracts and pays out a portion of its cash flow to shareholders. The benefit of this arrangement is that the Yieldco can have access to cheap funding
GE Energy Financial Services will have the right of first offer to invest in operating assets borne out of EGPNA’s development pipeline and other operating assets offered for sale by EGPNA for a three-year period.
“North America is one of our most dynamic growth markets and to this end I am delighted that we have established this strong industrial partnership with a business of the calibre of GE Energy Financial Services,” said Francesco Venturini, Chief Executive Officer and General Manager of Enel Green Power. “This partnership brings together two complementary leaders with a common view on the future of renewables development in the U.S. Moreover, the transaction is an early and important step forward in the delivery of our strategy to actively manage Enel Green Power’s portfolio of assets and further strengthen our growth opportunities globally.”