The names of other parties have surfaced in the final stages of the contest to buy the Australian arm of New Energy Solar.
DataRoom understands that as well as Palisade Investment Partners and Infrastructure Capital Group, Thai energy company Banpu has emerged in the competition.
This is along with Melbourne-based Lighthouse Infrastructure.
Palisade is believed to be teaming up with First Sentier Investors. The consortium has Macquarie Group on board for its tilt at New Energy Solar’s 110-megawatt Beryl plant and 55MW Manildra facilities in NSW.
Banpu is a Thai energy company with about $12bn of assets under its management and in recent years has generated close to $300m of net income.
It already owns Centennial Coal, which operates five mines in NSW that supply coal for export and about 40 per cent of NSW’s coal-fired electricity. The company sells about 40 per cent of its coal to export markets, primarily for use in power stations and steel mills in Japan, Korea, Taiwan and Europe.
Banpu’s three core businesses are energy resources, including coal and gas; energy generation, which includes conventional energy and renewable energy; and energy technology, which includes wind and solar solutions, storage systems and energy technologies.
The final parties in the contest are well-known names among recent renewable energy sales processes.
First Sentier purchased John Laing’s Australian wind farms for $285m and ICG bought Engie’s Willogoleche Wind Farm in South Australia and secured other development opportunities from Engie for $400m.
Asset sales in the renewable energy sector are happening as part of consolidation in the market at a time when investors in solar and wind farms need a more diversified portfolio rather than taking on risk with a single asset.
Finding buyers for solar farms, particularly in Queensland, is thought to be a more challenging ask than wind farms.
The problem for the solar industry, particularly in Queensland, is that there is often more supply than demand in the day, causing prices to fall.
The market value of New Energy Solar is currently at $279m and the assets have underperformed on the listed market, prompting a sale where a private investor would ascribe to them more value.
Investors seeking high returns are typically the sellers of such assets, whereas buyers coming in to pick up the assets are prepared to accept lower returns amid a low interest rate environment.
The listed New Energy Solar announced to the market last year that, following a strategic review, it had opted to sell its Australian solar farms.
Final bids are expected to be due within six weeks for the portfolio that is up for sale through the Royal Bank of Canada.
As well as its Australian portfolio, New Energy Solar owns 14 solar projects in the US.
New Energy Solar’s Australian solar farms have been described as being in a mature operational state compared with its larger US portfolio, which totals 606MW of capacity.
The company listed at $1.50 in 2017.
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