The Japanese trading house Marubeni has agreed to pay €100 million for a 25 per cent stake in Mainstream Renewable Power, the wind energy company controlled by Airtricity founder Eddie O’Connor.
The transaction is one of the biggest equity investments in an independent renewables company in recent times. It is the biggest single investment yet for five-year-old Mainstream, which is developing more than 40 wind and solar parks worldwide.
“This means everything to us, really,” Mr O’Connor told The Irish Times last night. “I have been talking to Marubeni since my Airtricity days. We now have one of the biggest energy investors in the world on board.”
Mr O’Connor said the cash would be used to develop the company and that existing investors would not be taking any of it off the table. “This money is 100 per cent for use by the company for growth. It will be several years before we pay a dividend, and I’m not sure if we ever will.”
The deal has yet to be approved by MRP investors. Mr O’Connor said he expected the deal to close this month.
Mr O’Connor built the company from the proceeds of the sale of Airtricity to Eon and Scottish and Southern Energy for €1.8 billion in 2008.
Marubeni is a substantial presence in the global energy industry, with large oil and gas interests, but is increasing its renewable energy investments, notably in the offshore wind sector. It teamed up with a government fund to snap up a British offshore turbine installation company, Seajacks, for $850 million last year.
It also has a stake in a British offshore wind farm off the coast of Essex and is part of a Japanese consortium that is testing floating wind turbines, a technology the wind industry hopes will drive big cost savings and efficiency improvements in coming years.
“We think the offshore wind market is expanding all over the world,” said Hiroshi Tachigami, president of Marubeni’s London-based subsidiary, Marubeni Europower.
Mr O’Connor said the deal would help accelerate Mainstream’s projects in Europe, Chile and South Africa, one of the brighter spots in a global renewable sector that suffered its sharpest annual fall in at least eight years in 2012, according to Bloomberg New Energy Finance research.
One of its more eye-catching European projects is a plan to build an “energy bridge” to export up to 5,000mw of electricity to Britain from wind farms in Ireland – on land and at sea – by 2017. – (Additional reporting: The Financial Times)