BlackRock is buying the shares owned by Finnfund, Vestas and Investment Fund for Developing Countries (IFU) in the 310MW Lake Turkana Wind Power (LTWP) project in Kenya.
Finnfund said it has agreed to sell its shares in the largest wind farm project in Africa to Climate Finance Partnership (CFP), a vehicle managed by BlackRock’s alternatives arm.
The Finnish development financier and impact investor said the return paid by the company and the transaction sum together correspond to more than twice the capital investment made by Finnfund.
Vestas and IFU are also selling their shares in the wind farm for an undisclosed sum. LTWP’s other shareholders are Anergi Turkana Investments, KP&P Africa and Sandpiper.
Construction of the €625m wind farm project began in 2014 and it was connected to the national grid in 2018.
Helena Teppana, Finnfund’s associate director, said: “We were there to share the initial risk of the construction phase and the start of operations. Today, it has been proved that the wind farm lives up to expectations and generates revenue from providing Kenya with low-cost green power. It is time for us to move on.
“Going forward, we will continue investing in renewable energy projects in the continent.”
David Giordano, global head of climate infrastructure at BlackRock Alternatives, said: “We are excited for CFP’s first investment to be in Kenya, one of Africa’s fastest-growing economies, and we look forward to working with our partners in the region to source future developments that not only capitalise on the historic investment opportunity presented by the energy transition, but also contribute to local economies.”
CFP is BlackRock’s $673m climate infrastructure investment fund which seeks to cut carbon emissions in emerging markets.
The vehicle is backed by a global consortium of 22 investors, including the French Development Agency, Germany’s KfW Development Bank, Japan Bank for International Cooperation, the Grantham Environmental Trust, the Quadrivium Foundation, and energy firm TotalEnergies.
The fund also counts AXIS Capital, Swedish pension fund AP2, insurer AXA, Dai-ichi Life Insurance, energy company E.ON, Finnish Church Pension Fund, Mitsubishi UFJ Morgan Stanley, Mizuho Bank, MUFG Bank, the Richter Family Office, Standard Chartered Bank and Sumitomo Life among its backers.
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