Norfund exits African hydropower assets
Norwegian development finance institution is selling its African hydropower assets to Savannah Energy.
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Norfund is selling its African hydropower assets to Savannah Energy, completing its exit from SN Power, the developer it created in partnership with Statkraft.
“When we can sell with solid returns to private actors and mobilise capital for new investments, we contribute even more effectively to development,” said Øystein Øyehaug, investment director at Norfund.
The Norwegian development finance institution is divesting its 50.1% stake in Klinchenberg, the vehicle that holds its African hydropower interests following the partial sale of SN Power in 2021. Klinchenberg’s portfolio includes stakes in three projects: Bujagali in Uganda, Mpatamanga in Malawi and Ruzizi III, a regional scheme involving Rwanda, Burundi and the Democratic Republic of Congo.
After building SN Power into one of the leading hydropower developers in emerging markets, Norfund sold the company to Scatec for NOK 10.9 billion (about $1.1 billion) in 2020. It retained ownership of SN Power’s facilities in Panama and Zambia, along with a 49% stake in the remaining African projects.
The Zambian facilities were sold earlier this year to Globeleq. In 2022, Norfund sold half of Klinchenberg to British International Investment. Scatec’s stake in the African projects that had been part of SN Power was also sold this year to TotalEnergies.
“The annual return of 21% in USD from these projects shows that it is possible to develop profitable energy projects even in some of the world’s most challenging markets. The capital we free up will be reinvested in new projects that contribute to sustainable growth,” says Øyehaug.
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