Iberdrola plans sale-leaseback deal for wind and solar farm land - sources

April 14, 2023 11:49 AM BST | By Reuters
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By Andres Gonzalez

LONDON (Reuters) - Power company Iberdrola plans to sell and lease back land on which some of its wind and solar farms are located as it seeks to lower its borrowing costs, according to three sources close to the deal.

Barclays is advising on the transaction, which includes the creation of a company that will own the land, according to the sources.

The land involved is in Spain and Iberdrola is looking for offers for a stake of up to 49% in the new holding company to avoid having to account for part of the proceeds as debt, the people said.

Iberdrola is aiming for the sale to value the holding company at 500 million euros ($553 million), one of the sources said. Iberdrola will put 15,000 hectares of land into it, with plans to add more in future, the source added.

Iberdrola didn't reply immediately to a request for comment. Barclays declined to comment.

Iberdrola unveiled last year a 47 billion-euro investment plan in electricity networks, renewable energy production and customer businesses in a push to remain one of the leaders in global renewable power.

The transaction is part of Iberdrola's broader strategy to lower its cost of capital after the surge in interest rates over the last year. The company has sold minority stakes in other business to reduce debt and recently it agreed to sell 13 power plants in Mexico in a deal worth $6 billion.

Iberdrola, which currently has 40 gigawatts of renewables capacity around the world, will pay rent to the new holding company for a set number of years.

The deal is being marketed to pension funds and other financial investors and Iberdrola would keep an option to buy back the 49% stake, two of the sources said.

($1 = 0.9042 euros)

(Reporting by Andres Gonzalez Editing by Elisa Martinuzzi and Mark Potter)


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