This divestment allows Orrön Energy to focus on accretive investment opportunities across its operating and greenfield businesses. The agreement, with an effective date of 1st January 2024 and structured on a debt and cash-free basis, is pending customary financing approvals from both Orrön Energy and Sognekraft. The closure is anticipated within the second quarter of 2024.
Having initially acquired a 50% interest in the company managing the Leikanger hydropower plant in 2019, the asset became integral to Orrön Energy's portfolio upon its transition into a renewables-focused entity in July 2022. Following the transaction, Sognekraft will own 100% of the company owning the Leikanger hydropower plant.
“This transaction is a perfect example of our opportunistic and entrepreneurial approach to value creation, and the sales price clearly demonstrates the underlying value of our assets and the discount in our share price,” commented Daniel Fitzgerald, CEO for Orrön Energy. “The Leikanger asset represents less than 10% of Orrön Energy’s annual power generation, however the value of this transaction represents approximately 20% of our enterprise value and 30% of our current market capitalisation. From inception we have been focused on project returns and this transaction allows us to recycle capital into projects and acquisitions with higher rates of return.”
