Renewable infrastructure fund Greencoat UK Wind has agreed to acquire a net 12.5% stake in Hornsea 1 offshore wind farm from Global Infrastructure Partners (GIP) for a total cash consideration of approximately £400m ($489m).
Hornsea 1 is the world’s largest offshore wind farm and is located 129 km off the Yorkshire coast in the North Sea. It comprises 174 Siemens 7 MW turbines and has a grid export capacity of 1,200 MW, making it the world’s first offshore wind farm to exceed 1 GW. Hornsea 1 entered into full commercial operation in December 2019, has a high load factor and benefits from a 15-year contract for difference (CfD) at a price of £175.25/MWh.
Hornsea 1 is currently 50% owned by Ørsted and 50% owned by GIP, with GIP’s 50% stake part funded by £2.9bn of limited recourse debt. UKW’s pro rata share of this limited recourse debt is £0.7bn, giving a total enterprise value of £1.1bn for UKW’s net 12.5% stake. Ørsted will continue to provide operation, maintenance and management services to the wind farm.
The acquisition is expected to complete in Q3 2022 and will be funded from cash flow and, to the extent required, the company’s revolving credit facility.