Norway Wealth Fund Enters Spanish Renewables With Iberdrola Deal

(Bloomberg) -- Norway’s wealth fund entered Spain’s renewable energy market by snapping up a 49% interest in a package of assets from Iberdrola SA.

The €600 million ($650 million) purchase follows a boom year for solar generation in Spain, whose abundant sunshine drives a thriving clean-energy industry. The deal reflects a gradual shift by Norway’s wealth fund, built from North Sea oil and gas riches, to expand in renewables, and a move by Iberdrola to focus more on energy networks abroad.

The transaction gives Norges Bank Investment Management a stake in 1.27 gigawatts of solar and onshore wind farms, valuing the portfolio at €1.2 billion, NBIM said Tuesday. No external debt was involved in the deal. Bilbao-based Iberdrola will remain co-owner and operate the plants.

The Spanish utility said last year it planned to divest €4.9 billion of assets through 2025 and raise €2.6 billion more by selling stakes in projects. That’s part of a push to form joint ventures with financial investors in a number of large businesses, raising funds to cut debt and reduce the cost of capital.

Iberdrola sold a 49% stake in a German wind farm to Energy Infrastructure Partners AG for about €700 million in September and is looking to sell an interest in its Brazilian transmission lines.

Oslo-based NBIM recently said it intended to make more investments in renewable-energy storage and transmission, after turbulent markets and soaring inflation led to losses across its portfolio over much of last year. It spent about €1.4 billion on a 50% stake in a Dutch offshore wind farm in 2021.

Wind, Solar

The Spanish portfolio includes five onshore wind sites and seven solar-plant projects, with solar accounting for 80% of the total. Nine projects are currently under development and are expected to be completed between 2023 and 2025.

The deal is part of a “global agreement,” David Mesonero, Iberdrola’s head of corporate development and M&A, said in a post on LinkedIn. It includes the construction of renewable assets in Spain, but “with the idea of ​​expanding it to more countries in the short term.”

Barclays Plc advised Iberdrola on the transaction.

--With assistance from and .

(Updates with Iberdrola comment in eighth paragraph, adviser in ninth.)

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