16 April 2024

NextEnergy Solar Fund has refinanced its existing £135m short-term Revolving Credit Facility

NextEnergy Solar Fund is pleased to announce it has refinanced its existing £135m short-term Revolving Credit Facility ("RCF") with AIB Group and NatWest which is due to expire in June 2024.

The new facility is available until June 2026 and provides two additional 12-month extension options at NESF’s sole discretion to bring the maturity date up to June 2028.  The RCF continues to benefit from attractive terms with a margin of 120bps over SONIA (“Sterling Overnight Index Average”).  The banking consortium consists of the Company’s existing counterparties AIB Group and NatWest in addition to a new counterparty Lloyds.

The Company is also on track to exercise its option to extend its current £70m RCF with Santander for another 12-months until June 2025 on similar terms and well ahead of its June 2024 expiry.  The Company will provide a further update to the market in due course.

RCFs are an important component of the Company’s disciplined capital structure and continue to provide the Company with flexibility both to drawdown to pursue value-accretive investments and to make repayments.  The Company continues to prioritise its Capital Recycling Programme and expects to use the proceeds from the Programme to pay down existing borrowings under the Company’s RCFs. 

As at 31 December 2023, the Company had drawn £163m from its £205m short-term Revolving Credit Facilities and had an unaudited Gross Asset Value (“GAV”) of £1,173m.  Gearing levels remain well within the Company’s investment policy limit of up to 50% of GAV and as of 31 December 2023 the Company’s gearing was 45.7% (including preference shares which have a fixed preference dividend of 4.75% and no financial maturity date). 

Ross Grier, COO and Head of UK Investments, NextEnergy Capital, commented:

“We are pleased to have secured similar terms on NextEnergy Solar Fund’s primary revolving credit facility.  As we have previously indicated, we continue to observe significant lender interest in providing debt to the solar infrastructure sector across the geographies we are active in.  This refinancing demonstrates lenders’ continued appetite to provide facilities against utility-scale solar assets in the UK on attractive terms. NESF maintains a disciplined approach to its capital structure and the sale of assets within the current capital recycling programme remain a key priority for the Company, the proceeds of which will be used to pay down existing RCF borrowings.”  

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