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Centrica, EIG to divest UK wind farms to GIB and BlackRock for £423m

Published 05 February 2016

Centrica and EIG Global Energy Partners (EIG) have agreed to jointly divest 50% stakes in the Glens of Foudland, Lynn and Inner Dowsing wind farms to the UK Green Investment Bank (GIB) Offshore Wind Fund and funds managed by BlackRock for £423m.

The sale is in line with Centrica's strategy to sell its stakes in wind power generation, while continuing to purchase wind power.

The GIB Fund will now own a 61% stake in the 194MW, Lynn and Inner Dowsing offshore wind farms while the remaining 39% will be held by funds managed by BlackRock. The Lynn and Inner Dowsing offshore wind farms with 54 turbines are located off the coast of Lincolnshire.

The fund, managed by UK GIB Financial Services, has a portfolio with a capacity to generate 3,970GWh of net renewable electricity annually. It has committed to provide £818m in renewable energy investments.

BlackRock-managed funds will own the 26MW Glens of Foudland onshore wind farm in Aberdeenshire, Scotland.

UK GIB Financial Services fund managing director Karl Smith said: "The unique partnership that we have entered into demonstrates the ability of the Offshore Wind Fund to capitalise on opportunities presented by the UK offshore wind sector, as well as highlighting the quality of existing assets in UK waters."

Centrica will continue to purchase 100% of the power and 50% of the Renewable Obligation Certificates ("ROCs") from the three wind farms until 2024, under existing power purchase agreements.

It will also continue providing operations and maintenance support to Glens of Foudland, Lynn and Inner Dowsing wind farms till March 2017.

BlackRock managing director Rory O'Connor said: "This landmark transaction demonstrates BlackRock's significant investment programme in the UK renewables sector. For investors, the sector can provide opportunities for less correlated, inflation-linked, long-duration income and attractive risk-adjusted returns."