NextEra Energy Resources LLC has decided to offload 90 per cent stake in a portfolio of 1 GW of renewable energy assets in the US, seeking to get USD 1.3 billion from the sale. The subsidiary of NextEra Energy Inc will also shed its 100 per cent stake in a 100-MW solar-plus-storage project, the parent company said.
The 1-GW portfolio will be purchased by NextEra Energy Partners LP and a tie-up of private infrastructure investors led by KKR, getting 40 per cent and 50 per cent respectively. NextEra Energy Resources will retain a 10 per cent equity interest and will have a right of first offer on the investors’ 50 per cent equity interest in the portfolio. The solar-plus-storage project is being acquired by NextEra Energy Partners. The total targeted amount includes tax equity and is subject to working capital and other adjustments.
According to the announcement, KKR will invest a total of about $1.4 billion in two transactions for equity interests in 1,625 megawatts (MW) of renewable energy assets. The total investment amount includes around $300 million direct equity purchase from NextEra Energy Resources for a 50 per cent interest in a 1,000 MW portfolio and a $1.1 billion convertible equity portfolio financing agreement with NextEra Energy Partners for an interest in a total of 1,125 MW project portfolio. KKR has also signed a letter of intent with NextEra Energy Partners to invest approximately $900 million in renewable energy transactions to provide access to capital for future expansion.
Calling this a “capital recycling opportunity,” NextEra explained that the fresh funds will be used for new wind, solar and battery storage projects, as well as for NextEra Energy Resources’ renewables backlog of over 15 GW. “These transactions are expected to generate significant value for NextEra Energy shareholders,” said Jim Robo, NextEra Energy chairman and CEO. The deal is subject to regulatory clearance and customary closing conditions and is seen to be completed in the last quarter of 2020.