In the second renewables project Linklaters has finalised this month, the Magic Circle firm has advised on the construction and financing of the offshore windfarm Beatrice located in the Outer Mary Firth, worth £2.6bn.
The 588-megawatt, 84 turbine wind project gained consent from the Scottish Government in March 2014 and was granted an Investment Contract by the UK Government in May 2014.
Linklaters advised on all aspects of the project, including on the £1.9bn debt financing. Projects partner Richard Coar led the Linklaters team advising the sponsors SSE Renewables, Copenhagen Infrastructure Partners and SDIC Power. The deal involved 13 commercial lenders along with the European Investment Bank and the Danish export credit agency Eksport Kredit Fonden which were advised by Norton Rose Fulbright. The Norton Rose team was led by Nicholas Pincott and Robert Marsh, and included derivatives partner Nigel Dickinson and tax partner Matthew Hodkin.
The project is the largest to reach successful financial close under the UK government’s new Contract for Difference (CFD) regime and one of Scotland’s largest infrastructure projects.
Coar said the successful financing of the transaction ‘represents an important landmark not only for each of the sponsors and the Scottish economy but also for the UK renewable industry.’
He added the project’s financing and development success ‘demonstrates that there remains strong appetite in both the equity and debt markets for well-structured renewable transactions, even ones of this scale and complexity.’
Beatrice is the second CFD Linklaters has finalised this month, with the firm advising the developers on the £1.3bn long-term financing for the development of one of the world’s largest offshore windfarms, the Dudgeon windfarm, off the east coast of England. The project was the first granted under the CFD. Projects partner John Pickett led the team advising the Norwegian oil & gas company Statoil, which has a 35% stake; Abu Dhabi’s renewable energy company Masdar, which also has a 35% share; and Norway’s state-owned electricity company Statkraft which owns the remainder. Allen & Overy acted for the mandated lead arrangers on the project.
While Magic Circle firms had been affected by a drop off in project finance work, Linklaters and A&O are the dominant firms in the market, with A&O controlling 10% of the market between January 2012 and December 2014, according to Dealogic.
Read more about project finance in the City in: ‘Price of debt – austerity and the plight of a project finance partner.’