Foresight Solar seeks share placing

Foresight Solar 2018 results published: Things looking up

Foresight Solar seeks share placing – Foresight Solar (FSFL) announced its intention to issue new ordinary shares of no par value in the company by way of a placing. The placing will be conducted under the company’s remaining shareholder authorities granted at the last AGM to issue up to 54,894,155 ordinary shares on a non-pre-emptive basis, being approximately 10% of the ordinary shares in issue at that time.

The company intends to use the net placing proceeds to optimise its capital structure, reducing gearing by repaying some debt that has been drawn down on the existing revolving credit facilities (RCF). The company’s total outstanding debt as of 31 August 2019 was £509.9m, including long-term debt of £404.9m and RCF of £105.0m

RCF funds acquisitions and capital raises used to repay

FSFL notes that asset acquisitions have typically been funded from the company’s RCF and then subsequently repaid from the proceeds of equity issuances at a premium to the prevailing NAV. Through reducing the company’s gearing, the company will have additional financial flexibility to pursue primary and secondary investment opportunities in the market in accordance with the investment policy.

Investment outlook

FSFL also released some outlook commentary. In addition to reviewing opportunities in UK subsidised solar markets, the fund’s manager continues to monitor a growing opportunity set in large-scale, subsidy-free markets in Spain, Portugal and the UK. Investments in subsidy-free assets are typically completed before the start of construction and include long term power purchase agreement structures, offering an attractive level of contracted revenues during the useful life of the asset. 

The company adds that the subsidised markets in the UK and Western Europe remain highly competitive with limited investment opportunities based on prevailing asset valuations. It therefore expects to take an opportunistic approach to any new investments in subsidised assets. 

FSFL: Foresight Solar seeks share placing

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