Report: UK Offshore Wind Sparks M&A Bonanza

Offshore wind investors were attracted to already committed funding consortia as projects hit important development milestones, the report said.

This resulted in offshore wind M&A activity worth GBP 3.4 billion last year, a marked rise on the GBP 384 million recorded in 2015. Banks also invested a record GBP 12.7 billion of project finance in offshore wind, up from GBP 6.1 billion in 2015.

“An active secondary M&A market boosted interest in onshore wind as large scale operational sites reached the end of their four to five year investment cycle,” TLT’s Head of Energy & Renewables Maria Connolly said.

”With a number of sites that were expected to come to market in 2016 delayed and a high first quarter figure for onshore wind M&A activity at £689million, we expect M&A activity to remain high in 2017.”

Looking forwards, M&A activity across the renewables sector will likely remain strong in 2017, with GBP 2.9 billion already recorded for quarter one, according to the report.

“The data for 2016 clearly shows a strong, robust sector adapting to a subsidy-free era.  Renewables projects are a good source of long-term and stable returns for investors and funders. Scale and maturity will continue to make renewables attractive to both finance and re-finance as the secondary market expands,” Connolly said.

Biomass and offshore wind are tipped to play a critical role in moving the UK towards a future where a large percentage of the energy consumed comes from renewable sources, the report said.