16th Jun 2014 08:10
LONDON (Alliance News) - Rame Energy PLC Monday said it has signed an exclusive framework agreement, including indicative terms, with Banco Santander unit Santander Investment Chile Limitada for up to USD69 million of equity financing for the company's next four wind projects in Chile totalling 118 megawatts.
Under the terms of the deal, which is subject to due diligence and final contracts, Santander would acquire each project for an already agreed price per megawatt and provide between 80% and 90% of the required equity capital for the project. Rame will contribute the balance of the equity and Santander shall be responsible for structuring the debt packages, the company said.
In a statement, Rame ssaid the companies envisage that the four projects will start commercial operations by the end of 2015 at the latest.
As part of the deal, Rame has a call option right to acquire Santander's equity once commercial operations start, based on an already agreed formula. Rame will also be contracted by Santander to oversee the construction of all four projects. The terms also specify that Santander should be considered first for the equity financing of future projects developed by Rame up until the end of 2016.
Rame Energy, which listed on AIM in April, started building the 15 megawatt Raki/Huajache wind projects in Chile in May. It expects to start putting up the wind turbines in October and the sites should be operational in the fourth quarter. EKA Chile SA will buy all of the energy they produce for ten years.
Rame Energy shares last traded at 15.125 pence in London.
By Steve McGrath; [email protected]; @SteveMcGrath1
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