27th Sep 2019 08:45
(Alliance News) - Renewables Infrastructure Group Ltd on Friday said it will propose a change in its investment policy to shareholders at a general meeting in October, and announced plans to issue new shares to fund acquisitions.
The renewable energy-focused investor wants to increase the amount of non-UK investments allowed to 65% of the portfolio. Its current policy does not allow for more than 50% of non-UK investments.
The investor said European renewable markets have "continued to evolve" and a number of countries where it has already invested in, including France and Germany, have "robust" government support for onshore wind and solar projects.
The investor added: "Elsewhere in mainland Europe falling capital costs, favourable weather conditions and the availability of land space to allow large-scale renewables projects, have resulted in renewable energy assets being developed at attractive risk adjusted returns without recourse to subsidies."
The UK will see growth of 20 gigawatts squared of renewable energy to 2030 while mainland European markets are expected to see more than 100 gigawatts cubed, the company explained.
Renewables Infrastructure said: "The current investment policy limit of not more than 50% of portfolio value in investments outside the UK is increasingly an impediment to the investment manager's ability to source investments with the best risk-adjusted returns and construct a balanced and diversified portfolio for the company."
The company will seek shareholder approval at an extraordinary general meeting on October 17.
Renewables Infrastructure also plans to new issues through its share issuance programme, which has 185.0 million shares still available.
The company said it is in its interests to issue new shares to raise funds instead of drawing down more funds from a credit facility with Royal Bank of Scotland PLC, National Australia Bank Ltd, and ING Group NV.
Funds from the placing will be used to fund acquisitions and repay amounts drawn under the GBP80 million facility.
The shares will be priced at 123.00 pence, a 6.0% discount to Thursday's closing price of 130.90p but a 7.0% premium to the net asset value of 115.00p from the end of June. If it does issue all 185.0 million shares, it will raise roughly GBP227.6 million.
Shares in Renewables Infrastructure were 3.0% lower at 127.09p each in London early on Friday morning.
By Eric Cunha; [email protected]
Copyright 2019 Alliance News Limited. All Rights Reserved.
Related Shares:
Renewables Infrastructure GroupRBS.L