Italy's ERG enters US renewable energy market with $270 mln deal (updated)

Erg SA

21/12/2023 13:27

(Adds details on ERG shareholders and business plan in
paragraphs 2 and 3)
       MILAN, Dec 21 (Reuters) - Italian renewable energy group
ERG  ERG.MI  said on Thursday it was entering the U.S. market
after signing a deal to buy two wind and solar assets of U.S.
rival Apex Clean Energy.
    ERG, which is owned by Italy's Garrone family and counts
among Australian fund IFM among its investors, said it would set
up a U.S. holding company with Apex to manage the assets,
comprising a wind farm and solar plant with 317 megawatts of
installed capacity. ERG will spend $270 million to buy 75% of
the holding company while Apex will own 25%.
    "We expect to present our strategy and growth targets in the
United States to the financial community in the first half of
next year with the 2024-28 industrial plan," CEO Paolo Merli
said.
    Apex will continue running the two assets operationally. The
deal is expected to close in the first half of next year subject
to clearance from U.S. and European authorities.
    The plants, located in the U.S. states of Iowa and Illinois
respectively, are estimated to generate around 1 terawatt hours
(TWh), ERG said in a statement. 
    The two assets benefit from tax equity investments under
U.S. energy incentive schemes, ERG said, adding it expects
steady revenues from the projects via long-term power purchase
agreements. The assets will be debt free at closing.
    ERG and Apex will also cooperate on new solar and onshore
wind projects of about 1 gigawatts being developed in the United
States. 
    Rothschild & Co acted as financial advisor on the
transaction. 

 (Reporting by Federico Maccioni and Valentina Za, editing by
Susan Fenton)
 ((Federico.maccioni@thomsonreuters.com; +39 3420768883;))