24 August 2015
BLUEFIELD SOLAR INCOME FUND LIMITED
Acquisition - Small Related Party Transaction
The Board of the Bluefield Solar Income Fund Limited (LON: BSIF) (the "Company") is pleased to announce that it has entered into binding sale and purchase agreements ("SPAs") to acquire three solar assets: Bluefield EIS Solar Limited ("Solar EIS"), Bluefield Kite Limited ("Kite") and Bluefield Peregrine Limited ("Peregrine"; collectively, the "Assets"), which between them own and operate 28 solar photovoltaic ("PV") plants (the "Plants"). The Plants, each built and commissioned prior to the end of Q1 2012, have over three years of operational record. The total consideration to be paid for the Assets is £5.95 million.
The Solar EIS Plant is a rooftop installation on a large commercial building in Corby, Northants with an installed capacity of 463 kilowatt peak ("kWp"). The Plant has been in operation and generating electricity since end of July 2011. The Plant benefits from a 25 year fully-indexed feed-in tariff ("FIT").
The Peregrine portfolio consists of 9 Plants installed on various water treatment plant sites south and west of London owned by Thames Water Utilities and has a total installed capacity of 430kWp. The Plants provide electricity to Thames Water Utilities pursuant to various lease and power purchase agreements ("PPAs"). Any excess generation is exported and each Plant benefits from a 25 year fully-indexed FIT.
The Kite portfolio consists of 19 Plants, with a total installed capacity of 824kWp, all but one of which are installed on water treatment plant sites in Oxfordshire and Gloucestershire owned by Thames Water Utilities. There is also a 50kWp rooftop Plant on Millennium Seed Bank, located in Wakefield Place. The Plants provide relevant landlords electricity pursuant to various lease and PPAs. Any excess generation is exported and each Plant benefits from a 25 year fully-indexed FIT.
The Company's investment adviser, Bluefield Partners LLP (the "Investment Adviser"), is also the investment adviser to Bluefield Solar EIS Fund, which holds the Assets, and certain members of the Investment Adviser hold Ordinary and B Shares in the Assets. Two of these members, James Armstrong and Michael Rand, are directors of Bluefield SIF Investments Limited ("Bluefield SIF"), or its subsidiaries, as well as directors of the Assets, and as such are related parties to the Group.
The members of the Investment Adviser who hold Ordinary and B Shares in the Assets are entitled through the B Shares to a carried interest in the sale of the Ordinary Shares, the total value of which between all B shareholders is £284,805.
Based on the amounts involved, the transaction falls to be treated as a smaller related party transaction as set out in Listing Rule 11.1.10R.
The Board believes the acquisition will be beneficial to shareholders for the following reasons:
· Diversification into FIT: Currently over 97% of the Company's portfolio consists of Renewable Obligation Certificate regime projects. Acquisition of the Assets will give the Company greater access to attractive FIT revenue, which is fully RPI indexed and therefore fully in line with the Company's investment objectives.
· Reduced exposure to power price and increased linkage to RPI: Each of the Assets relies upon FIT for between 83% and 89% of its revenue, which is 100% RPI correlated. The remaining 11-17% of revenue is contracted in each case with the industrial offtaker under fixed RPI linked contracts for the life of the lease (21-22 years remaining). As such only the power not utilised on site is subject to export price uncertainty.
· Diversification into rooftop installations: The Solar EIS and Millennium Seed Bank Plants will be the first rooftop installations in the Company's portfolio.
· The return on the investments is expected to be accretive to the Company's cashflow and net asset value, even on an unlevered basis.
Under the SPAs, the Group will purchase all of the Ordinary and B Shares of each of the Assets.
Completion of the SPAs will take the total number of acquisitions made by the Company to 59 and will be funded through the Royal Bank of Scotland revolving credit facility.
Enquiries:
James Armstrong / Mike Rand / Giovanni Terranova
Bluefield Partners LLP - Company Investment Adviser
Tel: +44 (0)20 7078 0020
Tod Davis / David Benda
Numis Securities Limited - Company Broker
Tel: +44 (0)20 7260 1000
Kevin Smith
Heritage International Fund Managers Limited - Company Secretary & Administrator
Tel: +44 (0)1481716000
Tom Karim
CNC
Tel: +44(0)20 3219 8820 / +44(0)7923 293 399
Note to editors
About Bluefield Solar Income Fund Limited (BSIF)
BSIF is a Guernsey-registered investment company focusing on large scale agricultural and industrial solar assets. It had an initial public offering of shares on the main market of the London Stock Exchange in July 2013. It has, currently, over 278 million shares in issue and a market cap in excess of £290 million. In June 2014 it agreed a three-year revolving credit facility with Royal Bank of Scotland, for up to £50 million.
BSIF seeks to provide shareholders with an attractive return, principally in the form of income distributions, by investing in a diversified portfolio of solar energy assets, each located within the UK, with a focus on utility scale assets and portfolios on greenfield, industrial and/or commercial sites. The Company intends to pay quarterly distributions.
About Bluefield Partners LLP (Bluefield)
Bluefield was established in 2009 and is an investment adviser to companies and funds investing in solar energy infrastructure. It has a proven record in the selection, acquisition and supervision of large scale energy and infrastructure assets in the UK and Europe. The team has been involved in over £1.4 billion of solar photovoltaic ("PV") funds and/or transactions in both the UK and Europe since 2008, including over £380m in the UK since December 2011.
Bluefield has led the acquisitions, and currently advises on over 50 UK based solar assets that are agriculturally, commercially or industrially situated. Based in its London office, Bluefield's partners are supported by a dedicated and highly experienced team of investment, legal and portfolio executives.
Bluefield was appointed Investment Adviser to the Company in June 2013.
