Canadian energy company Etrion has signed a definitive sale and purchase agreement to buy a portfolio of Deutsche Bank solar photovoltaic assets in Italy for €10.3 million, plus a contingent deferred payment of €1.5 million. The holdings include 6MW of operating assets and 10MW of permitted projects ready for construction in the southern Italian region of Puglia, plus a pipeline of more than 150MW in various stages of permitting, the company said.
The 6MW of ground-based PV plants produce more than 10,250KWhr of electricity and approximately €4 million of cash flow per year, according to Etrion. The plants benefit from Italy’s 2009 feed-in-tariff of €0.353/KWhr plus a spot rate of approximately €0.08/KWhr.
The operating plants also benefit from an existing facility agreement with Societe Generale and Dexia for up to €45 million, available on the basis of 90:10 debt-to-equity, of which €28 million have been drawn to date.
CEO Marco Northland said the “acquisition represents an important leap forward for Etrion. We are acquiring a combination of operating assets with immediate revenue, projects for construction in 2010, a pipeline for 2011, and relationships with highly qualified local developers. We look forward to building out the Italian pipeline that Deutsche Bank developed over several years.”
Etrion said it intends to fund the acquisition through a combination of cash on hand and a bridge loan from its major shareholder, Lundin Petroleum. The bridge loan carries interest at LIBOR plus 3%.
The acquisition is scheduled to close by April 30 and is subject to typical closing conditions.
Late last year, Etrion signed a deal with SunPower to build 4MW of solar power plants in Puglia.
