Aker Horizons Buys Up Mainstream Renewable Power

Norwegian investment giant Aker announced Tuesday it has taken a majority stake in Mainstream Renewable Power, the global wind and solar project developer.

Under the transaction, Aker’s cleantech investment subsidiary Aker Horizons will pay 758 million euros (USD $919 million) for a 75 percent stake in Mainstream, valuing the Dublin, Ireland-based developer at €900 million ($1.1 billion).

Aker Horizons has also acquired a 50 percent stake in superconducting cable systems developer SuperNode.

The deal, which is expected to close in the second quarter of this year subject to regulatory and other approvals, includes a €100 million ($121 million) earn-out payment due in 2023 if Mainstream meets “certain milestones,” Aker said in a press release.

IPOs in the pipeline
Mainstream’s shareholders, which include founder and chairman Eddie O’Connor, will reinvest in the business and retain a 25 percent ownership of the company, said Aker.

O’Connor is set to stay on as chairman of the board, which will be expanded with the addition of three Aker executives. The acquisition forms part of near-term plans to take Aker Horizons public on Euronext as a precursor to listing on the Oslo stock exchange, the 180-year-old company revealed.

The equity investment in Mainstream will help the developer finance ongoing construction projects, said Aker. The deal is one of the largest transactions in Aker's history, said President and CEO Øyvind Eriksen in a webcast.

“We are now looking at the most solid foundation in our industrial history,” he claimed. “Mainstream will unlock opportunities within Aker’s already differentiated portfolio.”

Separately to the Aker Horizons initial public offering (IPO), there are plans to list Mainstream within the next three years.

“We started our equity process over a year ago, and our ambition was to find a new partner who shared our vision of the energy transition,” said Mainstream CEO Mary Quaney on the webcast.

“We aim to bring 5.5 gigawatts of projects to financial close in the next three years, and the plan is to bring the business to IPO in that timeframe,” she added.

Kristian Røkke, CEO of Aker Horizons, confirmed the plans to list Mainstream within two to three years. “We see the public markets as an attractive market for growth capital,” he said. “We see a lot of investor interest for a company such as Mainstream.”

Aker's swelling low-carbon technology portfolio
The company, which will retain the Mainstream name after the acquisition, has 335 employees in 11 countries and has developed 6.4 gigawatts of renewable capacity since 2008.

Today it has a 1.4-gigawatt portfolio of projects in operation and under construction, with a pipeline of 10 GW, including 700 megawatts expected to reach financial close this year, and another 10 GW of identified project opportunities.

The operational projects include 22 percent of all the offshore wind capacity in the U.K. Mainstream is also the largest renewable energy developer in Chile and the second largest in South Africa, Quaney said.

The company is currently expanding in Vietnam, where it is developing a 1.4 GW offshore wind farm that is due to start generating power in 2023.

Mainstream will now sit alongside other Aker Horizons holdings such as Aker Carbon Capture and Euronext-listed Aker Offshore Wind, which is concerned with deep-water and floating wind projects.

SuperNode, meanwhile, will be transferred to Aker Horizon’s Sunrise Portfolio, which focuses on emerging technologies such as clean hydrogen.

As revealed by GTM last year, the company is looking to develop superconducting cable systems that will be able to collect offshore wind efficiently and export it to load centers across Europe.