British generator SSE Renewables is set to venture into the Mediterranean wind and solar business, after its purchase today of the southern European assets of turbine maker Siemens Gamesa.
The Hispano-German engineers will receive Euros580 million or £481 million, as SSE takes control of their wind and solar farms in Spain, Italy, France and Greece.
The Scots are paying cash for a 3.9GW portfolio of wind assets, either operating or planned. Co-located next to some are 1GW of solar projects, whose future development is included as an option in today’s deal.
Forty staff will move onto the SSE payroll. Future partnership in maintenance and servicing of the aeolian structures is presaged in today’s contract.
Cervantes up a deal, ready to Rocinante and roll
SSE Renewables is aiming to have around 500MW of projects acquired today operational by March 2026, plus another 500MW in construction. That’ll be in line with the company’s targets under its parent’s Net Zero Acceleration Programme. These foresee:
· 4GW of net additions over five years, doubling installed renewable capacity to 8GW by 2026
· maintaining a pipeline of at least 15GW of renewables projects in development
· 1GW net or more in capacity additions per year after 2025; thereby
· trebling installed renewables capacity to over 13GW and in turn target a fivefold increase in renewables output to 50TWh annually by 2031.
Stephen Wheeler, managing director of SSE Renewables, enthused: “We are delighted to boost the delivery of SSE’s Net Zero Acceleration Programme by expanding our existing renewables business into southern Europe through this acquisition.
“Mainland Europe is an exciting growth market for onshore wind, with clear carbon reduction targets and supportive policies, Wheeler went on. “The project portfolio brings some excellent assets and will provide a real springboard for our expansion plans in Europe across wind, solar, batteries and hydrogen,”
“Today’s announcement demonstrates Siemens Gamesa’s capacity to optimize its portfolio of assets and maximize value,“ enthused Jochen Eickholt, the firm’s CEO
“Our South European project development team has built an excellent portfolio of wind projects in four countries; as a result, there has been very strong market interest for this portfolio. We are confident SSE will be the right partner to develop these projects and integrate our employees”.
Quixotic? Not slow, certainly
Eickholt took over last month as boss of Siemens Gamesa’s 26,000 staff, tasked to revive the manufacturer after it struggled during lockdown with snags in its supply chains. Its installed turbine park worldwide runs to 120GW.
SSE Renewables’ parent, Perth-headquartered SSE, is investing £7million every day, equivalent to £2.5bn each year until 2027, to deliver that Net Zero Acceleration Programme.
Formal closing of today’s deal is subject to regulators’ approval, and is expected before Siemens Gamesa’s accounting year ends.
Bank of America Securities and CMS Albiñana & Suárez de Lezo advised the turbine makers on financing and structuring the transaction.
Investors on the LSE loved the deal. By late afternoon, SSE’s share price had risen over 2% to a twelve-month high, valuing the group at £19.1 billion.
