By Fiona Harvey, Environment Correspondent
Published: March 22 2010 19:54
One of the boldest flotations of a “green” company in years is planned for next month, when the solar energy company Engyco hopes to raise €500m to €1bn (£900m) to invest in Spanish solar farms.
Interest in green technology companies was strong before the financial crisis, but since then the credit crunch and recession have combined with a poor outlook for the renewable energy business, leading to a drought of flotations.
Engyco wants to buy existing solar farms in Spain, where the climate and government support for renewable energy have encouraged the building of large-scale projects using photovoltaic technology, similar to the solar panels now seen on roofs.
Some investors see now as a good time to pick up such assets relatively cheaply, as although government subsidies guarantee attractive prices for solar energy, the cost of capital has risen in Spain with the collapse of its construction and property sectors. As a result, many owners of solar farms are willing to sell.
Engyco believes it will be able to run the solar farms at a lower cost, giving a higher rate of return.
The company has agreements in place covering about €640m of such assets, making up a capacity of about 86MW, and is looking for further opportunities.
The company is headed by several big names from the utilities industries. John Roberts, non-executive chairman, was chief executive of United Utilities and is a non-executive director at the BlackRock New Energy Investment Trust. Thomas Krupke, chief executive of Engyco, was chief executive of Solon, one of Europe’s biggest manufacturers of solar components.
Alexander Voigt, executive vice-chairman, has a history in photovoltaics going back to 1986, and was a co-founder of Solon.
Engyco’s non-executive directors include Thomas van Aubel, co-founder of Q-Cells, one of the world’s biggest solar manufacturers; Pedro Mielgo, former chairman of Spain’s national grid company Red Electrica de Espana; and Martin Negre, former chief executive of Northumbrian Water Group and chairman of Ecofin Global Utilities Hedge Fund.
Engyco has appointed Numis Securities and Ambrian Partners as advisers for its proposed listing on London’s main market, which is planned for late April or early May.
So far, the company’s capital has been supplied by its founders and directors.
Mr Roberts said: “The assets that we intend to manage enjoy both favourable operating conditions and a highly attractive pricing regime.”