Aquila European Renewables (AER), an investment company focusing on renewable energy technologies, secured a five-year debt facility of €50 million (~$55 million) from ING Bank, which is backed by AER’s solar project portfolio in Spain.
The company’s solar projects, with a total capacity of 180 MW, are under long-term power purchase agreements.
AER intends to use the net proceeds from the debt facility to repay the existing revolving credit facility (RCF), resulting in available capacity under the RCF of approximately €70 million (~$77 million) out of the €100 million (~$110 million) limit.
The undrawn RCF capacity would provide the company with flexibility for future capital allocation decisions, including the continuation of the share buyback program.
The loan from ING Bank has a lower interest rate than its current credit facility. Pricing terms of the debt facility were undisclosed.
AER has hedged 90% of the debt facility with an interest rate swap over the life of the loan. The loan also has flexible repayment options, such as a partial amortization, a balloon payment at the end, an accordion option of €18 million (~$19.69 million), and two extension options of 12 months each, subject to ING Bank’s approval.
“We are pleased to have secured the debt financing at such attractive terms, fulfilling one of the key initiatives announced in May 2023 prior to the Company’s inaugural continuation vote. We are working with our advisers to evaluate how the incremental capital can be most appropriately allocated for the benefit of shareholders,” said Ian Nolan, Chairman of AER.
According to Mercom’s 9M and Q3 2023 Solar Funding and M&A Report, solar debt financing activity in 9M 2023 totaled $16 billion in 54 deals, 93% higher than 9M 2022 when $8.3 billion was raised in 48 deals.
BrightNight, an independent power producer, announced the completion of a $375 million corporate credit facility to expand its ~31 GW renewable energy portfolio in the U.S. BrightNight’s project portfolio in the country includes solar, energy storage, and integrated technologies.
