African Infrastructure Investment Managers (AIIM) has acquired majority stakes in three new solar power plant projects in South Africa on behalf of its IDEAS Managed Fund.
The 30MW project – developed by BBEnergy, Energy Group and Harmony – has been financed through a mix of debt and equity. Equity was funded by the open-ended SADC region infrastructure fund IDEAS and the Mahlako Financial Services-managed Mahlako Energy Fund 1. Debt was provided by Rand Merchant Bank.
AIIM said the projects, which reached financial close in May this year, are expected to reach commercial operation in March and April 2023.
African Clean Energy Developments (ACED), an AIIM affiliate, has served as the technical lead and transaction managers on the projects and will manage the construction process. Energy Infrastructure Management Services, another AIIM affiliate, will manage the operations once the projects reach their commercial operations date.
Sean Friend, investment director at AIIM and co-portfolio manager of the IDEAS Managed Fund, said: “Together with our partner Mahlako, we are excited to conclude this transaction and create a long-lasting partnership with Harmony.”
Friend said the deal ”further entrenches IDEAS as a leading investor” in renewable energy, as well as the commercial and industrial private power market in particular.
”We look forward to pursuing additional investments in this sector, in light of the focus on clean energy and the need to pursue a sustainable energy mix for SA,” Friend added.
Mitesh Pema, principal of the Mahlako Energy Fund 1, said the investment is a testament to Mahlako’s commitment to energy security and sustainable investments while ”providing superior returns for our investors”.
“Further to our ESG principles enshrined in our investment process, we actively seek out opportunities that contribute towards South Africa’s clean energy goals.”
James Cumming, general manager at ACED, said: “Reaching financial close on these projects is not only a fantastic achievement for Harmony and all those involved in the transaction, but it also highlights that the South African commercial and industrial power market and wheeling makes economic sense for private off-takers and investors, and is bankable.”
Amedeo Buonajuti, director at Energy Group, said: “Private offtake contracts of this scale are a milestone for renewable energy in South Africa. We are grateful for Harmony’s visionary partnership and support from Eskom, NERSA and government.”
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