(Alliance News) – Georgia Capital PLC said Tuesday it has acquired Hydrolea Ltd, an operator of three hydro power plants and a greenfield hydro project.
The Georgian-focused investment firm did not disclose the acquisition price, but said the transaction values Hydrolea at USD38.5 million.
Georgia Capital will provide up to USD10 million in equity capital and a USD13.3 million short-term bridge facility to fund the acquisition. It expects to refince the bridge loan by the end of 2019.
Hydrolea operates three hydro power plants, which have an aggregate installed capacity of 21 megawatts, and has a greenfield run-of-river type project targeting a capacity of 19 megawatts.
The three operational projects are expected to add between USD4.1 million to USD4.4 million in earnings before interest, taxes, depreciation and amortisation to Georgia Capital’s Renewable Energy business in 2020.
The 19 megawatts pipeline project is expected to be commissioned by the end of 2022, with construction starting in 2020, once a permit has been finalised.
Following the acquisition, the Renewable Energy business will have an installed capacity of 71 megawatts, and a pipeline of 350 megawatts in the medium term.
“I am pleased to announce that our Renewable Energy business has secured these high-quality assets with existing strong dollar-linked cash flows and high growth prospects. Georgia has gradually become a net electricity importer over the last two years, with growing internal electricity demand pointing to a record high 1.4 terawatt-hour deficit by 2019, which is expected to grow significantly in the coming years,” said Chair and CEO Irakli Gilauri.
“With this acquisition, our Renewable Energy business continues to progress towards achieving its medium-term goal to become a dominant player in the fast-growing Georgian electricity market, which has benefited from recent market deregulation,” Gilauri added.
Shares in Georgia Capital – which is headquarted in Tbilisi, Georgia – were flat at 970.00 pence on Tuesday in London.