Scatec, fund manager form JV around Release platform

The "Release by Scatec" solution in containers. Source: Scatec

Norwegian renewable power producer Scatec ASA (OSL:SCATC) has agreed to raise USD 102 million (EUR 114m) in funding for its Release business in a deal that calls for Climate Fund Managers (CFM) to purchase a minority stake in the particular platform.

The climate-centric blended finance fund manager, which is backed by the Dutch Development Bank (FMO) and Sanlam Infraworks, part of the Sanlam Group of South Africa, will pay USD 55 million for a 32% interest in Release. Additionally, CFM will provide USD 47 million of shareholder loans, a portion of which will be on concessional terms.

Following the transaction, expected to close in the third quarter, Scatec will remain the majority shareholder in Release with a 68% stake. The Norwegian company created this platform in 2019 with the purpose of providing the mining and utilities market with a flexible leasing solution of pre-assembled and modular solar and battery equipment. Terje Pilskog, Scatec’s CEO and Chair of Release, commented that this market segment requires a different business model than Scatec’s larger scale project business.

Release currently has operational plants and projects under construction in Cameroon, South Africa, Mexico, and South Sudan with a combined capacity of 47 MW of solar photovoltaic (PV) and 20 MWh of battery storage. It also has contracts for 35 MW of solar PV and 20 MWh of storage in Chad.

“The new shareholder funding will be supplemented by Release through additional debt and guarantee facilities that are currently in advanced negotiations. This gives us the financial foundation we need to meet the strong demand for our flexible leasing model, for easily deployable renewable power plants,” commented Hans Olav Kvalvaag, CEO of Release.

“Our blended finance model facilitated the integration of impact finance into the deal structure, which Release will be able to leverage to improve its cost structure for its battery and grid connection solutions, allowing Release to offer even more competitive pricing and better value to its clients,” stated CFM’s own CEO, Andrew Johnstone.

(USD 1.0 = EUR 1.123)

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