London-based private equity firm Actis has agreed to sell its 100% stake in African green energy platform BTE Renewables to French companies Engie and Meridiam in a deal valued at $1bn.
Under the Sales and Purchase Agreement signed with Actis, Engie will acquire BTE’s South African assets while Meridiam will acquire the Kenyan assets. Completion of the transaction is expected by Q4 2023.
Actis established the pan-African renewable energy platform in 2017 when it acquired the Kipeto wind project in Kenya.
In 2019, Actis expanded the platform by acquiring South Africa-based BioTherm Energy. The platform was then renamed BTE Renewables (BTE).
The platform currently has six operating projects totalling c500MW in generating capacity, with five projects in South Africa and one in Kenya.
BTE, focused primarily on utility-scale wind and solar projects, is the second largest renewables player in Africa after Lekela Power, which Actis sold to Infinity Power in March this year
“The sale of BTE Renewables marks our fifth energy platform exit in Africa, where we have now built and owned 5GW of generation capacity, making Actis one of the largest investors in the regional energy sector,” head of Middle East & Africa Energy at Actis, Lisa Pinsley, said in a company statement. “We are confident that BTE, with its new shareholders, will continue to play a leading role in the energy transition across Africa.”
Boosting energy security with renewables
The deal to buy BTE Renewables will increase Engie’s presence in South Africa where existing power stations are struggling to keep up with growing electricity demand amidst a power crisis caused in part by ageing coal plants in need of constant maintenance.
The acquisition allows the French utility to keep BTE’s solar and wind assets (340MW) in South Africa as part of its strategy to cut coal and accelerate clean-power production.
“The acquisition of BTE is bringing to Engie high-quality wind and solar assets and a strong project pipeline,’’ Senior Executive Vice President of Renewables, Energy Management and Nuclear at Engie, Paulo Almirante, said in a separate statement. “With this integration, ENGIE is pursuing its development outside Europe and the Americas.”
Meridiam, a global investor and asset manager specialising in public and community infrastructure, is also deepening its presence in Africa. In Gabon alone, the firm says it has invested in no fewer than four infrastructure projects worth around €1.5 billion. The investments include the Kinguele Aval hydroelectric dam currently under construction.
The BTE deal adds a new area of expertise through exposure to wind energy, Meridiam’s first in the sector. The deal paves the way for the firm to acquire the 100MW Kipeto wind farm, which has been operational since 2021.
Also included is the 50 MW Siruai greenfield wind project with an integrated energy storage facility under development.
“This transaction reinforces our footprint both in Kenya and more globally in Africa where we invested more than €5 billion to date,” Partner and Deputy CEO of Meridiam, Mathieu Peller, said, adding the acquisition complements its existing mix of renewable portfolio which already comprises solar, hydro, biomass and geothermal assets. “Taking (also) into account the pipeline assets, this project will double our total renewable generation capacity in Africa and bring it to over 500 MW.”
The deal is made possible through the Meridiam Infrastructure Africa Fund (MIAF). The firm launched the Fund in 2015 to make long-term investments in African infrastructure, with 40 per cent of the Fund commitments intended for climate finance.
Meanwhile, Actis, one of the biggest investors of private capital in Africa, has invested over $2 billion in energy infrastructure in Africa over the past two decades, covering utility-scale renewable projects, industrial solar plants and power generation with natural gas.
The investment firm has said it could invest up to $300 million annually in renewable energy and gas-fired power projects on the continent.