“By choosing Voltalia as a partner for setting up in Latin America, we want to benefit from 13 years of know-how in managing construction, operation and maintenance of wind farms in Brazil. Brazil is a market were renewable energy is, by far, the cheapest source of electricity. This represents a huge pool of opportunities. Through this partnership, we will be able to enter into this market with significant and performant assets for long-term value creation for all stakeholders. This success also confirms our capacity to originate and execute deals on a global scale”, rejoices Charles-Henri Malécot, CEO of STOA.
“Welcoming STOA, a top-tier French investment player, as one of our long-term partners is a very pleasant perspective. This project of partnership opens even larger growth prospects for Voltalia in Brazil while creating value: it is a good illustration of our strategy aiming at developing a large volume of competitive projects with the idea of onboarding thirdparty investors, through partnerships or sales”, declares Sébastien Clerc, CEO of Voltalia.
The project of partnership
The VSM 1 (163 MW) and VSM 2 (128 MW) wind farms, currently under construction, are integral part of Voltalia’s Serra Branca cluster in the Brazilian state of Rio Grande do Norte.
Featuring excellent wind conditions and entirely developed by Voltalia’s teams, the Serra Branca cluster is the largest in Latin America. Its total potential is greater than 2.4 GW, of which 873 MW are currently either in operation or in construction: 600 MW owned by the Group and 273 MW by Echoenergia, a subsidiary of international investor Actis (within a partnership of up to 500 MW–see Voltalia’s Press Release dated September 11, 2018). Rapid expansion of the Serra Branca cluster is facilitated by the power transmission lines developed, built and owned by Voltalia which are used to connect the cluster to the Brazilian national grid.
The 100% sale of ready-to-build projects by Voltalia (as for Echoenergia-Actis) or the sale of minority stakes to investors (as for STOA) are part of Voltalia’s services strategy to develop large volumes of very competitive projects, in order to keep some while selling others to financial partners or utilities. To date, Voltalia has developed and sold a total of 1,4 GW around the world, in addition to the 1GW portfolio developed and kept by the Group (see Voltalia’s press release dated form June 13, 2019).
This sale of a minority stake, if confirmed, will have no impact on Voltalia’s P&L, in accordance with IFRS rules, since Voltalia intends to retain control of the VSM 1 and VSM 2 plants. Voltalia’s capital gain as part of the transaction will be recognized directly in the Group’s equity. The transaction should be finalized during Summer 2019.
This first project for STOA in Latin America follows previous investments closed notably in South Africa, Cameroon and in India. For STOA which has already committed €160 million in less than two years in Africa and in India, this partnership with Voltalia contributes to the portfolio’s geographical diversification beyond the priority given to the African continent, as wished by both co-shareholders. After the dam project of Nachtigal in Cameroon finalized in December 2018, these two Brazilian wind farms represent a strong commitment in favour of renewables in developing countries, one of STOA’s targeted sectors.
