Greensphere Capital seeks $500m for renewables in London IPO
Greensphere Capital plans to raise $500m in a London IPO for investment into sustainable infrastructure such as renewable energy sources. The company will offer up to 500 million shares for $1 each, and is aiming to list on the Premium Segment of the Main Market of the London Stock Exchange by 20 December. The move will be sponsored, brokered and placed by Numis Securities. Areas that Greensphere plans to expand its portfolio into include renewables, energy transmission, distribution and storage projects, sustainable agriculture and related areas.

Greensphere Capital Plc is aiming to raise as much as USD 500 million (EUR 422m) from an initial public offering (IPO) in London to invest in sustainable infrastructure, including renewables.

The company on Thursday announced the initial placing and offer for subscription of up to 500 million shares at USD 1 apiece. It wants to list on the Premium Segment of the Main Market of the London Stock Exchange (LSE) by December 20. Numis Securities is the sponsor, broker and placing agent in the UK.

Greensphere is building a diversified portfolio of Sustainable Infrastructure Investments in energy transmission, distribution and storage, renewables, water, waste, sustainable agriculture and other sectors. Its focus will be on countries in the Organisation for Economic Co-operation and Development (OECD), but it may also invest up to 30% of its net asset value (NAV) in assets or businesses in non-OECD countries.

IPO DETAILS

The IPO will include a placing primarily targeted at institutional and professionally-advised private investors, and an offer for subscription available to UK investors. The deadline for receipt of application forms under the offer for subscription is December 14, while placing commitments under the initial placing are due on the next day. First admission of Greensphere stock and dealings are seen to start on December 20, 2017.

PORTFOLIO AND INVESTMENT POLICY

The company will be investing, directly and indirectly, in Sustainable Infrastructure Investments which mitigate against the risks of resource scarcity, input price and project life-cycle cost volatility, and climate stress.

Greensphere will actually maintain two investment portfolios -- a private one with unlisted Sustainable Infrastructure Investments and a listed one. The focus of both will be investments with “stable cashflow generation potential over the longer term, strong, creditworthy counterparties, and proven, experienced management teams and operators”, the company said.

The Listed Portfolio, managed by Ecofin, will contain liquid equity and equity-related securities of companies in the "Renewable Infrastructure Universe", listed or traded on one or more stock exchanges. The Listed Portfolio may be invested in limited partnerships (LPs), renewable infrastructure funds and closed-end funds which invest in income producing assets.

The "Renewable Infrastructure Universe" includes companies and businesses engaged in the production of renewable power, such as solar, wind, geothermal, hydro and biomass power plants, or the transmission, distribution and storage of energy. These would be companies based mainly in North America, Europe and Asia, but also in other geographies.

Greensphere said it will invest mainly in operational assets, but it may spend up to 30% of the NAV of the Private Portfolio on projects under construction or in development.

DIVIDENDS

In its first financial year, Greensphere will target a dividend of USD 0.03 per share. This is to grow to USD 0.05/share in the second financial year, and to USD 0.06/share after that. The company will target a total return, including distributed dividends and growth in the NAV per share, but excluding share price performance, of 10% to 12% per year on the issue price over the long term.

(USD 1 = EUR 0.84)

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