Purchase of Con Edison Clean Energy
RWE becomes the second largest US solar plant operator
10/01/2022 11:51 p.m
With an acquisition, the energy group RWE is becoming a heavyweight in renewable energies in the USA. A solar system operator is worth almost seven billion euros to the group – but a lot is expected of them.
RWE is strengthening its US renewable energy business with a $6.8 billion acquisition. The energy group is buying the solar system developer and operator Con Edison Clean Energy Businesses from the regional supplier Con Edison from New York, as it announced in Essen.
With the takeover, which is equivalent to 6.9 billion euros (including debt), RWE has almost doubled its portfolio of wind, solar and battery storage systems in the USA and now has an installed capacity of 7.2 gigawatts (GW). When it comes to financing, the Essen-based group is receiving support from Qatar’s sovereign wealth fund, QIA, which is signing a EUR 2.43 billion mandatory convertible bond. This means that QIA can take a good nine percent stake in RWE, making it its largest shareholder.
“The takeover of Con Edison Clean Energy Businesses means an enormous boost for RWE’s green expansion in the USA, one of the most attractive and fastest growing markets for renewable energies,” CEO Markus Krebber explained the acquisition. This will make RWE number two in the USA among operators of solar systems and number four overall for renewable energies.
Energy mainly from solar systems
Around 90 percent of Con Edison Clean Energy’s three gigawatts of installed capacity is solar. In addition, according to RWE, there is a development pipeline of another seven gigawatts, which will increase the group’s project pipeline there to 24 gigawatts. The takeover is expected to be completed in the first half of 2023.
Con Edison Clean Energy is expected to contribute an operating result (Ebitda) of 600 million dollars to RWE’s profit in the first year. The group had already planned 15 billion euros for investments in “green energies” in the USA. “I am pleased that QIA is supporting RWE’s ambitions to grow faster and stronger with additional equity,” said Krebber. RWE wants to finance the part of the purchase price that QIA does not pay with loans.