Restructuring of renewable generation debt

RNS Number : 3819U

Good Energy Group PLC

01 April 2021

 

Good Energy Group PLC

("Good Energy" or "the Company")

Restructuring of renewable generation debt

Good Energy Group PLC (AIM: GOOD), the 100% renewable electricity supplier and innovative energy services provider, announces the restructuring of the financing on its renewable generation asset portfolio to consolidate and simplify funding facilities, that together with a strong net cash position gives the Company greater capital flexibility going forwards.

Restructuring of generation assets financing

At the 30th June 2020, the latest balance sheet reporting date prior to this restructuring, Good Energy had two secured bank loans against its 50MW of wind and solar assets, comprising:

· £5.1m secured against Good Energy's Delabole wind farm financed by the Cooperative Bank ("Co-Op");

·£33.2m secured against the rest of the solar and wind asset portfolio, financed by funds managed by Gravis Capital Management Limited ("Gravis").

Today's refinancing and restructuring consolidates the generation assets into one portfolio that will be solely financed by funds managed by Gravis and will amortise through to June 2035. The cost of settling the Co-Op debt is de minimis.

Significant liquidity and cash flow benefits

Whilst headline gearing will not change on completion, the restructuring and refinancing provide a number of real benefits to Good Energy, both short term and long term.

Initially, it will provide £7.8m of unrestricted cash on completion, of which:

o £4.7m relates to the release of various reserve accounts and other restricted cash balances which form part of the existing facilities;

o  £3.1m of additional debt raised against the Delabole windfarm, associated with mirroring the terms of Delabole in line with the rest of the portfolio.

Longer term, the transaction also provides on-going improved visibility of cash flows, with a rebalancing of the performance covenants over the entire generation portfolio. This frees up future cash generated by the generation portfolio to be utilised by the Company.

The upfront cash provided, combined with existing strong levels of cash on the balance sheet gives the Company the ability to wholly repay Good Energy Bonds II. It is anticipated that this will be completed during FY2022. At the end of December 2020, the outstanding capital on Good Energy Bonds II was £16.8m, while associated interest costs are £0.8m per annum.

Further Transaction Details

Today's refinancing and restructuring consolidates the generation assets into one portfolio that will be solely financed by Gravis through a revised facility of £39.8m and which will be amortised to June 2035. Good Energy Generation Asset No. 1, a wholly owned subsidiary of Good Energy, has entered into an Amended and Restated Loan Facilities Agreement ("ARA LFA") with its incumbent lender GCP Green Energy 1 Limited. In addition to the restructuring of the existing facility and terms, the ARA LFA provides Good Energy with an additional £7.1m in bank loans to prepay its outstanding loan facility with the Cooperative Bank PLC ("Co-Op Facility"), whilst consolidating all generation assets under one financing facility. The Co-Op Facility was previously used to finance the 9MW Delabole windfarm on a standalone basis.

Gravis is the investment advisor to GCP Infrastructure Investments Limited, a FTSE 250 investment company listed on the Main Market of the London Stock Exchange that focuses on investments in debt secured against UK infrastructure projects.

Juliet Davenport, Founder and Chief Executive Officer of Good Energy, said:

"This transaction provides the business with simplicity and clarity over the funding of our high performing generation portfolio and delivers greater capital flexibility and further underpinning our balance sheet resilience.

We are really pleased with the underlying performance of the group and look forward to building on these successes in 2021 as we continue to invest for the future" 

Good Energy was advised on the transaction by KPMG (financial), Burgess Salmon (legal), PKF (tax) and TLT (property).  

Gravis was advised on the transaction by CMS Cameron McKenna Nabarro Olswang LLP (legal), K2 Management (technical) and PMC Treasury (hedging).

Enquiries:

Good Energy Group PLC Juliet Davenport, Chief Executive Charles Parry, Investor Relations Luke Bigwood, Communications	Email: [e-mail] Email: [e-mail] Phone: [phone]
Investec Bank plc (Nominated Adviser and Joint Broker) Jeremy Ellis Sara Hale	Tel: [phone]
Canaccord Genuity Limited (Joint Broker) Henry Fitzgerald - O'Connor Georgina McCooke	Tel: [phone]

Notes to editors:

About Good Energy www.goodenergy.co.uk

Good Energy is a generator and supplier of 100% renewable power and an innovator in energy services. It currently owns two wind farms, six solar farms and sources electricity from a community of 1,600 independent UK generators.

Since it was founded 20 years ago, the company has been at the forefront of the charge towards a cleaner, distributed energy system. Its mission is to support UK households and businesses generate, store and share clean power.

Good Energy is recognised as a leader in this market, through our green kite accreditation with the London Stock Exchange and as a top rated Green energy supplier by Which?.

 

END

 

 

MSCEASLFEEAFEFA