New Energy Solar launches bookbuild

HUAINAN, CHINA - JUNE 13: Chinese workers walk on a section of a large floating solar farm project in Huainan, Anhui province, China. (Photo by Kevin Frayer/Getty Images)

New Energy Solar will launch its bookbuild today for its initial public offering, in a deal that will be closely watched.

Some question whether the business has the level of institutional support to head to the market and say it will now largely rely on support from retail investors.

Investment bank Morgan Stanley is working on the raise with broker Evans and Partners.

The company had opted to raise between $100m and $300m and apparently has already secured about $100m worth of support from retail investors.

New Energy Solar has set its bookbuild price range at between $1.45-$1.55 per share and the deal will be priced on Tuesday.

The group’s distribution yield will be between 5 per cent and 5.3 per cent and its market value is expected to be between $387.4m and $587.4m.

The company hopes to begin trading on December 8.

When listed, New Energy Solar will comprise of interest in four large scale solar generation facilities based in California and North Carolina in the United States.

One point of contention is its debt levels, which account for 50 per cent of total gross assets.

Plans are also afoot to invest in other renewable energy assets, including wind, geothermal, hydro-electricity, hybrid solutions and associated investments such as battery and other storage, smart metering and potential future technologies.

Currently, net assets are $277.2m.