BCI and Its Partners Acquire Reden Solar
A consortium led by Macquarie Group Ltd. agreed to acquire French solar farm developer Reden Solar SAS for an enterprise value of 2.5 billion euros ($2.7 billion), as it looks to benefit from a global push toward green energy.
The deal, with the buyer group including British Columbia Investment Management Corp. and MEAG, adds to the list of investors pouring in money into renewables with Europe seeking to become carbon neutral by 2050. Clean power is coming into even sharper focus as governments in the continent look to reduce dependence on Russian gas following the country’s invasion of Ukraine.
Reden Solar, which develops, finances, builds and operates plants across Europe and Latin America, is currently 53% owned by InfraVia Capital Partners and 47% by Eurazeo SE. It has a 762-megawatt operational portfolio and a 15-gigawatt development pipeline, Macquarie said in a statement Monday.
“Reden Solar’s geographically diverse platform provides an exceptional opportunity to scale up its development pipeline to help meet net-zero targets across Europe,” Stephane Brimont, head of France, Benelux and Greece at Macquarie Asset Management, said in the statement.
The sale will generate cash proceeds of 632 million euros for Eurazeo, representing an internal rate of return of around 42%, the French investment company said in a separate statement. The transaction is expected to be completed by the third quarter.
Citigroup Inc. and Nomura Holdings Inc. acted as M&A advisers to InfraVia, according to the Paris-based private equity firm. Weil and Gotshal & Manges were its legal adviser. Goldman Sachs Group Inc., Rothschild & Co., and White & Case advised the consortium of buyers.
Earlier today, BCI released a statement that a Macquarie Asset Management Consortium it is part of agreed to acquire Reden Solar:
Macquarie Asset Management, in a consortium with British Columbia Investment Management Corporation (BCI) and MEAG, has reached an agreement to acquire Reden Solar from InfraVia Capital Partners and Eurazeo for an enterprise value of €2.5 billion.
Reden Solar develops, finances, builds and operates solar power plants across Europe and Latin America, with a 762 MW operational portfolio and a 15 GW development pipeline. Headquartered near Toulouse, Reden Solar has an established presence in France and Spain as core markets, and has recently expanded its footprint into Greece and Italy.
Thierry Carcel, Chief Executive Officer of Reden Solar, said: “We are delighted to have Macquarie, BCI and MEAG support the next phase of our growth ambitions. Our business is continually evolving from predominantly rooftop solar, into ground mounted and agrivoltaic projects. With the backing of our new shareholders, we look forward to expanding Reden Solar’s presence in existing and new markets, as well as developing our teams on the ground.”
Stéphane Brimont, Head of France, Benelux and Greece at Macquarie Asset Management, said: “Reden Solar’s geographically diverse platform provides an exceptional opportunity to scale up its development pipeline to help meet net zero targets across Europe. Their management team has a proven track record of developing projects in core as well as new European markets. We are excited to support them over the long-term as they build out their business and maximise their contributions towards the low-carbon transition.”
Lincoln Webb, Executive Vice President and Global Head of Infrastructure and Renewable Resources at BCI, said: “We look forward to partnering with the management team and staff of Reden Solar in the continued growth and development of the company. In the context of stronger national climate policies and clean energy goals, we believe Reden Solar is well-positioned to continue providing market leadership in the development and operation of solar energy and contributing to global energy transition aspirations.”
Holger Kerzel, Board of Management, MEAG: “This project fulfills our high expectations for sustainable investments and underlines our commitment to increase MEAG’s exposure in renewable energy. With this investment, we will support the future growth of one of Europe’s leading independent power producers covering the entire value chain of photovoltaic energy production. We are very pleased about this transaction and look forward to a successful partnership with Macquarie, BCI and Reden Solar.”
Macquarie Asset Management’s stake in Reden Solar will be acquired on behalf of institutional investors via Macquarie Global Infrastructure Fund and Macquarie Green Investment Group Renewable Energy Fund 2 (MGREF2). Reden Solar represents MGREF2’s fourth investment, having recently completed the acquisition of Apex Energies Group in France.
Macquarie Group is a leading global renewables developer having invested or arranged around €40 billion in green energy since 2010, and with more than 50 GW of green energy projects in development, construction and operation worldwide.
The transaction is expected to reach completion by Q3 2022.
About Macquarie Asset Management
Macquarie Asset Management is a global asset manager that aims to deliver positive impact for everyone. Trusted by institutions, pension funds, governments, and individuals to manage more than £403 billion in assets globally, we provide access to specialist investment expertise across a range of capabilities including fixed income, equities, multi-asset solutions, private credit, infrastructure, renewables, natural assets, real estate, and asset finance.
Macquarie Asset Management is part of Macquarie Group, a diversified financial group providing clients with asset management, finance, banking, advisory and risk and capital solutions across debt, equity, and commodities. Founded in 1969, Macquarie Group employs approximately 17,000 people in 33 markets and is listed on the Australian Securities Exchange.
All figures as at 31 December 2021 For more information, please visit macquarie.com.
About Reden Solar
Reden Solar is an independent producer of photovoltaic renewable energy, focused on the development, construction and operation of photovoltaic power plants in France and abroad. Founded in 2008, at the heart of the French Lot-et-Garonne region, Reden Solar now owns and operates more than 750 MW of installed capacity and employs over 120 people across eight countries. Over five years of ownership, InfraVia (53%) and Eurazeo (47%) has supported the company’s development. For more information visit reden.solar
About BCI
With C$199.6 billion of assets under management as of March 31, 2021, BCI is one of Canada’s largest institutional investors. Based in Victoria, British Columbia, BCI is a long-term investor that invests across a range of asset classes: fixed income; public equities; private equity; infrastructure; renewable resources; real estate; and commercial mortgages. BCI’s clients include public sector pension plans, insurance, and special purpose funds. BCI’s Infrastructure & Renewable Resources program, valued at over C$20.0 billion, invests in tangible long-life assets that include a portfolio of direct investments in companies across a variety of sectors spanning regulated utilities, energy, telecommunications, and transportation, as well as investments in timberlands and agri-businesses. These companies operate in stable and mature regulatory environments, provide opportunities for future capital investments, and have the potential to generate steady returns and cash yields for our clients. The program is diversified across North America, Asia, Australia, Europe, and South America.
About MEAG
MEAG manages the assets of Munich Re and ERGO. MEAG is active in Europe, Asia and North America and offers its comprehensive know-how to institutional investors and private clients. In total, MEAG manages investments currently worth €339 billion, of which €65 billion relates to business with institutional investors and private clients.
The acquisition of Reden Solar from InfraVia Capital Partners and Eurazeo for an enterprise value of €2.5 billion is a big deal.
BCI, Macquarie Asset Management and MEAG are the new owners and their focus will be on expanding Reden Solar’s presence in existing and new markets.
I looked at the REDEN Group's website to learn more about the company and its operations:
Founded in 2008, the REDEN group is an independent producer of photovoltaic renewable energy, focusing on the development, construction and operation of photovoltaic power plants in France and abroad.
A specialist in photovoltaic electricity production, we cover the entire development cycle of a photovoltaic energy production facility. We are thus able to provide seamless management of each stage of a project’s development, from the initial studies through to maintenance, including the manufacture of photovoltaic modules at our own production facility in France.
REDEN’s growth has continued to gain momentum since 2008 and should reach 1 GW in capacity in 2022, today making it a benchmark player in energy transition.
With its headquarters in Agen (47) in the south-west of France, REDEN also has an international head office in Madrid (Spain), together with branches in Toulouse (31), Bordeaux (33), Nîmes (30) and each country where REDEN is present: Spain, Portugal, Chile, Puerto Rico, Mexico, Greece and Italy.
With a focus on Europe and South America, REDEN expanded to Greece in 2020 and Italy in 2021.
Benevolence, Commitment, Ethics and Professionalism are the group’s four pillars of performance that guide us daily in all our activities.
A COMMITTED PLAYER IN THE ENERGY TRANSITION
The very nature of REDEN’s activities in France and abroad means that every day its work is committed to sustainable development and producing energy that is cleaner for our planet.
ISO 9001 and 14001 certified for several years, the REDEN group is a responsible company that has sought to push its responsible strategy even further.
Finding the best solutions to meet its corporate, environmental, social and economic challenges, REDEN has embarked on an active policy of Social and Environmental Responsibility based on ten commitments established in its CSR Charter.
Linked to our values these ten commitments are central to each of our activities and seek to align economic development with social responsibility and deploy a responsible approach to energy.
Clearly, the REDEN Group is growing fast and I encourage you to read more about this company here.
Both InfraVia Capital Partners and Eurazeo did a great job nururing this company during its development phase.
The Eurazeo press release is worth reading:
Eurazeo has reached an agreement with Macquarie Asset Management, in a consortium with British Columbia Investment Management Corporation (BCI) and MEAG, to sell its 47% stake in Reden Solar, a leading European independent solar power producer, based on a €2.5bn Enterprise Value. Reden Solar is active across eight countries, with more than 750 MW in operation and a sizable maturing pipeline.
The disposal would generate cash proceeds of €632 million for Eurazeo, representing a cash-oncash multiple of 4.3x and an internal rate of return (IRR) of around 42%.
Since acquiring Reden Solar in 2017, Eurazeo’s Real Assets team has worked alongside its coinvestor InfraVia to support the group’s development, capitalizing on its long-standing experience in the sector, including platform management, structuring and expansion through a combination of organic and external growth. Along with the leadership of Reden Solar’s seasoned management team, this has resulted in the growth of the group’s capacity by 8x and its EBITDA by more than 4x over the past five years and extended its footprint across Southern Europe, bolstering its market positions.
This is a great asset for BCI, Macquarie Asset Managementa and MEAG, one that I am sure will continue to grow very nicely over the next ten+ years.
In BCI's press release, Lincoln Webb, Executive Vice President and Global Head of Infrastructure and Renewable Resources at BCI, said: “We look forward to partnering with the management team and staff of Reden Solar in the continued growth and development of the company. In the context of stronger national climate policies and clean energy goals, we believe Reden Solar is well-positioned to continue providing market leadership in the development and operation of solar energy and contributing to global energy transition aspirations.”
If you're wondering how BCI will achieve net zero by 2050 or earlier, look no further than to mega deals like this acquisition of Reden Solar.
Europe is undergoing a massive energy transition and it needs to continue on this path to achieve energy independence and realize its climate related targets.
The crisis in Ukraine which BCI and other large Canadian pensions have publicly decried only underscores how important this ongoing energy transition really is.
In related news, BCI recently announced that KKR is acquiring a majority stake in Referesco:
Refresco Group B.V. (“Refresco” or “the Company”), one of the largest independent beverage contract manufacturers in the world, and KKR, a leading global investment firm, today announced that KKR has signed a definitive agreement to acquire a majority stake in Refresco, with Refresco’s existing investors, PAI Partners and British Columbia Investment Management Corporation (“BCI”), maintaining a significant minority position. Terms of the transaction, which is subject to closing conditions, were not disclosed.
Founded in 1999, Refresco is a global independent beverage solutions provider for retailers and branded beverage companies with pan-regional coverage in Europe and North America through its network of bottling, warehousing, logistics and other operational assets. The Company’s production platform includes over 70 majority-owned manufacturing sites in Europe, the U.S., Canada, and Mexico, providing customers with close proximity and a reliable service across geographies. Refresco has built long-standing relationships with its customers by partnering to support material planning, procurement, manufacturing, warehousing, fulfillment, and distribution.
KKR will support Refresco as it expands its global and strategically located footprint to better serve existing and new customers through a range of formats and channels. The Company will build on its ability to manufacture high quality products that meet the growing demand for sustainable beverage solutions, with a focus on sustainable sourcing, responsible production, and environmentally friendly operations.
“We are very pleased to welcome KKR, one of the world’s most prominent investment firms, as our new majority owner. We are proud that PAI and BCI will continue as shareholders, which is a testament to our successful value creation,” said Hans Roelofs, CEO of Refresco. “To support further growth, we have explored the various alternatives available to us and believe that the investment by KKR is an incredibly positive development for the Company. Like our existing shareholders, KKR is supportive of our strategy and will bring operational expertise, access to capital and a well-established network to support us in our growth, innovation, and M&A strategy. Our focus of growing alongside our customers, combined with expanding into new categories and geographies, remains unchanged. I look forward to this new chapter, and for all our employees and customers to capitalize on the opportunities ahead of us.”
“Refresco has established itself as an industry leader supporting the global beverage industry with a blue-chip global customer base, an experienced and highly regarded management team, and an impressive network of assets that provides compelling value to customers. The Company also has a strong commitment to sustainability, which is an important differentiator for its customers,” said James Cunningham, Partner at KKR. “We look forward to leveraging our operational expertise from across the KKR platform to support the Company’s continued growth and further advance the sustainability of its value chain.”
“We are proud to have been instrumental in Refresco’s growth since we initiated our investment with BCI in 2018,” said Frédéric Stévenin, Managing Partner of PAI Partners. “We are even more excited about the prospect of continuing to stay a part of Refresco’s strong growth trajectory alongside KKR. We are convinced of Refresco’s unique value-add capabilities, its growth initiatives and a proven M&A track record, and we look forward to the next phase of this journey.”
“As an institutional investor with a long-term perspective, supporting strong management teams and market leading companies is core to our private equity program. We are in full agreement with Frédéric’s comments and are very happy to continue this partnership with management, PAI and KKR,” said Julian Remedios, Senior Managing Director, Private Equity, BCI.
KKR is making this investment primarily through its Global Infrastructure strategy, which was established in 2008. Since that time, KKR has been one of the most active infrastructure investors around the world with a team of more than 70 dedicated investment professionals. The firm currently oversees approximately $40 billion in infrastructure assets and has made over 60 infrastructure investments across a range of sub-sectors and geographies.
ABOUT REFRESCO
Refresco is the global independent beverage solutions provider for retailers and A-brands with production in Europe and North America. Refresco offers an extensive range of product and packaging combinations. Focused on innovation, Refresco continuously searches for new and alternative ways to improve the quality of its products and packaging combinations in line with consumer and customer demand, environmental responsibilities, and market demand. Refresco is headquartered in Rotterdam, the Netherlands and has more than 10,000 employees. www.refresco.com
ABOUT KKR
KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life, and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com and on Twitter @KKR_Co.
ABOUT PAI PARTNERS
PAI Partners is a pre-eminent private equity firm, investing in market-leading companies across the globe. It has significant experience in the food and beverage space and is currently invested in Tropicana Brands Group, the world’s leading manufacturer of premium juice brands, Froneri, the world’s #2 ice cream manufacturer, and Ecotone, a leader in healthy and sustainable food. It manages over €17 billion of dedicated buyout funds and, since 1994, has completed 89 investments in 11 countries, representing over €65 billion in transaction value. PAI has built an outstanding track record through partnering with ambitious management teams where its unique perspective, unrivalled sector experience and long-term vision enable companies to pursue their full potential – and push beyond. Learn more about the PAI story, the team, and their approach at: www.paipartners.com
Note BCI and PAI Partners are still maintaining a significant minority position in Refresco.
KKR is acquiring a majority stake and will look to grow Refresco's operations.
The only part of the press release that threw me off a bit was this: "KKR is making this investment primarily through its Global Infrastructure strategy, which was established in 2008."
This isn't an infrastructure investment so I am not sure why KKR is making this investment primarily through its Global Infrastructure strategy.
Anyway, having a strong partner like KKR to take this company to the next level will only add to BCI and PAI Partners' returns.
Below, learn more about Reden Solar watching this corporate clip (in French). I also added a promotional video for the open day at Reden Solar's solar greenhouses in Central France (built in 2019).
That reminds me, I should put Gordon Fyfe and Stephane Brimont, head of France, Benelux and Greece at Macquarie Asset Management in touch with my cousins in Crete who run Plastika Kritis, a private company that specializes in the production of masterbatches and agricultural films (see third clip).
If Reden Solar expands its operations in Greece to Crete, this is the family to talk to.
Lastly, a song that was made by employees to celebrate Refresco's 20th anniversary (February 2021). Refresco, let's go!!
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