SSE this morning announced the sale of four wind farms to a new fund managed by Greencoat Capital for £140 million in cash, with £43 million of the consideration to be invested into shares in the new fund.
The process is dependent on Greencoat Capital successfully listing on the London Stock Exchange, as well as raising the required capital. This is expected to be completed by the end of March, when completion of the sale will also take place.
The four wind farms -- two in Scotland, two in Northern Ireland -- have a total generation capacity of 79.5MW and, as part of the deal, SSE has agreed to enter into power purchase agreements, or PPAs, for three of the wind farms totaling 43.5MW. SSE will have the operation and maintenance contract for all four wind farms.
One the sales are completed, SSE will have 1,351MW of onshore wind farm capacity in operation in Great Britain and Ireland. It also currently has 277MW of new wind farm capacity that is in construction or pre-construction.
SSE finance director Gregor Alexander commented:
This agreement represents the latest step in a program of acquisitions and disposals to optimize our wind farm portfolio. Fundamentally, SSE owns generation capacity to meet the electricity needs of its own customers, which is why we were pleased to be able to establish new PPAs before disposing of these assets.
The proceeds from these disposals will support our investment in new renewable assets in the coming financial year and, in line with our commitment to financial discipline, represent an excellent example of SSE creating ongoing value from its investment pipeline while improving the liquidity of the market for investment in new renewable developments.
The news follows SSE's prediction that its full-year dividend would be around 84 pence per share, which would yield a very healthy prospective income 5.9%, and would be the group's fourteenth successive full-year dividend increase.
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