Irish renewables developer Mainstream Renewable Power has signed an equity investment deal worth €100 million (US$133 million) with Japan’s Marubeni Corporation trading company.
The stated aim of the deal is to accelerate Mainstream’s key projects, with Marubeni acquiring a 25% holding in Mainstream. Subject to shareholder approval of the deal, Marubeni will become the second largest shareholder in Mainstream, with the right to representation on the Mainstream board of executives.
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Mainstream was founded in 2008 and numbers Barclays among its other investors. Mainstream have recently announced several projects, including a plan to develop solar and power projects in Chile, in a deal worth US$1.4 billion. The company has developed renewable energy plants in nations including Ireland, South Africa, Chile and Canada with projects underway or planned in three further countries.
Mainstream Renewable Power's chief executive Eddie O'Connor said: “This investment is a game-changer for Mainstream allowing us to focus on accelerating our project portfolios across a range of markets as well as entering into new strategic jurisdictions which present strong value opportunities for our business.”
Marubeni is one of the largest of a handful of trading companies, or ‘shosha’ in Japan, which combine large-scale direct involvement in various industry sectors with acting as investment banks and vehicles for raising private equity. Other shosha include Mitsubishi and Sumitomo, both of which have either solar power projects in their investment portfolios or direct involvement in planning and construction of PV projects.
The deal is thought to be part of a wider strategy by Marubeni to further expand the power generation portfolio held by the Japanese company. Marubeni also signed deals in gas and thermal power recently to manage 3.3GW of power generation capacity from thermal in Portugal and the company is also involved in offshore wind and geothermal energy projects in Japan. Marubeni were forced at the beginning of 2012 to pay a US$54.6 million fine relating to charges of corruption in Nigeria over the award of contracts to build a natural gas plant.