Greencoat UK Wind PLC (LSE:UKW) has agreed to sell partial stakes in three of its wind farms, raising a total of £181 million and bringing its cumulative disposals over the past year to £222 million.
The London-listed renewables investment group said on Wednesday that it will dispose of 32.65% interests in each of the Andershaw and Bishopthorpe onshore wind farms for £42.6 million.
The price represents the net asset value of the interests as of 30 June. The buyer is a private investor.
Andershaw is a 35-megawatt wind farm in Scotland acquired by Greencoat in September 2021, while Bishopthorpe is a 16.4-megawatt wind farm in England, bought in June 2017.
In a separate deal, Greencoat has agreed to sell a 1% interest in the Hornsea 1 offshore wind farm for a gross asset value of £69 million, including £39 million of Greencoat’s proportional share of project-level debt.
A further 1% interest in Hornsea 1 is also due to be sold on the same terms, with completion expected in August.
Greencoat said the proceeds from today’s disposals will be used primarily to reduce the company’s borrowing and to support its share buyback programme, which was announced in February.
Alongside the disposals, Greencoat also published its results for the half-year to 30 June, reporting that its portfolio of UK wind farms generated 2,581 gigawatt-hours of renewable electricity over the period.
Net cash made across the group and its wind farm subsidiaries came in at £163.3 million, providing dividend cover of 1.4 times.
The company reported a net asset value of £3.18 billion at the end of June, equivalent to 143.4 pence per share.
To put that into context, the company is valued at £2.68 billion, which equates to a 19% discount to its NAV.
Or, put another way, investors today would be buying Greencoat's generating assets for just over 80p in the pound.
It is also providing a steady income stream with the group declaring total dividends of 5.18p for the period and paying a dividend of 2.50p relating to the fourth quarter of 2024.
During the half year, the company bought back 35 million of its own shares at an average price of 115p each.
Its debt stood at £2.25 billion as at 30 June, representing 41.5% of gross asset value. If the proceeds from the latest disposals are used to repay debt, pro forma gearing would be 39.5%.