Investec Expecting $832 Million in Energy IPOs and FundraisingLouise Downing
Investec Bank Plc expects to be involved in initial public offerings and capital raises this year that may total as much as half-a-billion pounds ($832 million) for power companies.
The bank will work on raising equity capital for companies that are already public and are looking for more money or businesses undertaking an initial share sale, said Nigel Robinson, Investec’s head of power and infrastructure finance. The first transaction may come in the middle of this year.
Investec has clients in India, Africa and Asia who are looking to use the liquidity, transparency and governance of the London capital markets and stock exchange to raise funds, Robinson said. Investors are seeking dividends that beat returns on government bonds as the Bank of England holds its benchmark lending rate at a record low.
“Renewable power has an increasingly important role to play in high-growth emerging markets where grid infrastructure is inadequate,” Robinson said in London. “By providing generation on a distributed basis close to the load centers, renewable-energy portfolios can quickly meet local power demand.”
Last year saw more than 900 million pounds raised for clean energy by four closed-end quoted funds, according to Angus McCrone, senior analyst at Bloomberg New Energy Finance. Most of those are for U.K. wind and solar.
Investec is working with companies planning to invest in different regions and in projects such as small hydropower and wind plants. “The marketplace is currently very congested with companies looking for equity capital and inevitably there are some ‘me-toos,’” Robinson said. “In our view, investors are likely to stay away from these.”
Should all the fundraising happen in the next 12 months they may support as much as about 400 megawatts of projects.
Investec last month said it’s acting as sponsor for the listing of Ingenious Media Holdings Plc’s closed-end quoted fund that will invest in onshore wind, solar and energy efficiency. The inclusion of efficiency differentiated it from other funds that listed last year, including Greencoat U.K. Wind Plc and Bluefield Solar Income Fund Ltd.