FRANKFURT, Jan 14 (Reuters) – RWE said on Wednesday it agreed to sell a 50% stake in its Norfolk Vanguard West and East offshore wind projects to investor KKR, after the German utility emerged as one of the winners in a milestone British renewables auction.
No financial details were disclosed for the deal, which is expected to close in the summer, but RWE said that both parties will “assess opportunities to extend their collaboration to additional projects”.
RWE and KKR will jointly develop, build and operate the wind farms, a model referred to as farming down that enables both project developers and financiers to split the bill for large offshore projects, which usually start at 1 billion euros ($1.2 billion).
Shares in RWE, Germany’s biggest utility, were 3% higher on the news, making them the top gainers among blue chips in Frankfurt’s benchmark DAX index.
RWE’s Norfolk Vanguard East and West projects, located 50-80 miles off the British coast, were awarded contracts by Britain, covering 3.1 gigawatts, and will be able to power around 3 million homes once operational.
The deal follows RWE’s sale last year of a 49% stake in two offshore wind farms in Denmark and Germany to Norway’s sovereign wealth fund for 1.4 billion euros.
($1 = 0.8588 euros)
(Reporting by Christoph SteitzEditing by Ludwig Burger)
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