Italy's ERG enters US renewables market with $270m asset buy and 'strategic partnership'
CEO Paolo Merli sees move as a 'unique opportunity' for company to continue growing its project portfolio
Italian renewable energy group ERG is entering the US market through a “strategic partnership” with Apex Clean Energy comprising an initial $270m majority acquisition of two assets, and cooperation to develop about 1GW of solar and wind projects.
The transaction, which is subject to US and European regulatory approvals and expected to close in first half 2024, calls for creation of a joint holding company here to manage the 224.4MW Great Pathfinder wind farm in Iowa and 92.4MW Mulligan solar array in Illinois.
ERG would own 75% of both facilities with Apex retaining 25% and remaining the operator. Great Pathfinder began commercial operation in February and Mulligan in July 2022.
The two assets benefit from tax equity investments and long-term power purchase agreements with market-leading counterparties, and will be debt-free at closing, according to both companies.
“We proudly announce the entry of ERG in the US renewable market,” said Paolo Merli, CEO of ERG, describing the move as a “unique opportunity to continue growing our project portfolio, and increasing geographical and technological diversification.”
The announced deal is the latest in a flurry of Canadian and European acquisitions of US renewable energy assets and companies spurred by availability of lucrative federal tax credits and other subsidies in the world's second largest solar and wind market after China.
Genoa-based ERG was founded in 1938 by Edoardo Guida Garrone and in the ensuing decades was a crude oil refiner and acquired petrol stations in Italy and Spain. Shares have traded on the Italian bourse since 1997.
The family-owned company exited the refining sector in 2011. ERG owns onshore wind farms in Bulgaria, Poland, Italy, Romania, and the United Kingdom, and hydro assets and solar arrays in its home market.
Australian pension fund is among ERG’s investors, according to Reuters.
Apex is a leading independent renewable energy development company and power producer based in Virginia.
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