Stanlib fund buys 60% stake in Upington Solar

Stanlib Infrastructure Fund II, which invests in renewable energy, digital infrastructure, transportation infrastructure and logistics, has agreed to acquire a majority stake in Upington Solar Power.

The Standard Bank-owned asset manager’s second infrastructure fund will take a 60% holding in the 258MW solar complex by purchasing separate equity stakes from two Norwegian investors.

The deal involves Oslo-headquartered renewable power producer Scatec selling its 42% stake to the Stanlib Infrastructure Fund II while Norfund, the Norwegian development finance institution that invests in developing countries, will sell an 18% stake in the project.

“We are delighted to have secured this investment,” said Greg Babaya, head of infrastructure investments at Stanlib.

“It fits perfectly within our mandate to give investors exposure to diversified, stable and risk-appropriate returns. It also provides additional exposure to an asset class that is a strong tool to drive economic growth and makes a tangible difference to SA communities — particularly at a time when the country is suffering an acute shortage of power generation.”

Upington Solar, a complex of three 86MW solar photo-voltaic projects, was a successful bidder under the fourth round of SA’s Renewable Energy Independent Power Producer Programme. It was completed in 2020 and has an estimated annual output of about 650 GWh, sufficient electricity to power about 12,000 households while abating about 600,000 tonnes of carbon dioxide a year. Scatec will continue to provide operational, maintenance and management expertise in order to support the solar complex.

“We are very pleased with this transaction and are confident that Stanlib will be a solid owner of the asset going forward,” Scatec CEO Terje Pilskog said.

While the transaction remains subject to regulatory approvals, it is expected to close in the first half of 2023. Over the past 10 years, Stanlib’s infrastructure investments unit has invested in 27 projects and currently has about R11bn in assets under management.

WE ARE VERY PLEASED WITH THIS TRANSACTION AND CONFIDENT STANLIB WILL BE A SOLID OWNER OF THE ASSET

Terje Pilskog Scatec CEO