HgCapital LLP, a London-based private equity company, invested in a wind park and received a 36 million-pound ($58 million) Royal Bank of Scotland Group Plc loan to help finance the northern England project.
RBS acted as lead arranger, agent and hedging bank for the loan, HgCapital said today in a statement. HgCapital provided equity for the 20.5-megawatt Wandylaw project in Northumberland, Tom Murley, director and head of HgCapital’s renewable energy team, said by phone. He declined to disclose the amount.
HgCapital, with assets including health care firms and industrials, is among private equity companies becoming bigger backers of clean-energy ventures. Guy Hands’s Terra Firma Capital Partners Ltd. bought three wind U.K. wind farms this month while KPMG LLP said mergers and acquisitions in renewable energy will be driven more by private equity rather than utilities as the industry offers increasingly stable returns.
With Wandylaw, HgCapital has contributed to more than 700 megawatts of renewable energy projects in Europe worth at least 1.5 billion euros ($1.9 billion), according to the company.
“It’s a difficult market but as lenders focus on high-quality sponsors, we have not had an issue in raising debt,” Murley said. “Does it take longer -- yes -- but banks do want to lend to good sponsors and we’re fortunate enough to be considered a good sponsor.”
HgCapital-held company RidgeWind developed the project using 10 turbines made by Repower Systems SE, a unit of Indian turbine maker Suzlon Energy Ltd. Construction will start this month with operation expected in early 2013.