AIIM in Witkop Solar Park deal

14 Oct 2020

Cape Town, 14 October, 2020: Phakwe Group, with the support of African Infrastructure Investment Managers (AIIM), one of Africa’s largest infrastructure-focused private equity fund managers and a member of Old Mutual Alternative Investments, has achieved financial close on a secondary renewable energy transaction, to become the 90%-owner of Witkop Solar Park, a 30MW solar PV facility located in the Limpopo province, South Africa.

Project Witkop has been operational since 2015 and is part of the first group of projects to connect to the national grid under the South African Renewable Energy Independent Power Producer Programme (REIPPP). On average, the solar power plant generates 62,000MWh per annum of electricity which is sold into the national grid to Eskom Holdings SOC Ltd, benefiting over 6,000 households.

The project currently supports 36 full-time operations and maintenance jobs; with women and youth-owned businesses in the local area being preferred for the provision of security services, vegetation management and support technical services essential to the project.

This deal concludes Phakwe’s ninth investment in a renewable energy project, and results in a portfolio that now comprises over 500 MW of generation capacity.

Thabiso Tenyane, Executive Chairman, at Phakwe Group, commented: “We are delighted to be the first to achieve this milestone in South Africa’s renewable energy programme and to be working with AIIM once again - their expertise in the clean energy sector and their commitment to enhancing Black Economic Empowerment (BEE) objectives in South Africa, is second to none. With its funding, AIIM has helped position Phakwe Power, a 100% black-owned and managed IPP, as a leading participant in one of the fastest growing and most dynamic sectors in the South African and global economies.”

AIIM – through its IDEAS Managed Fund – provided funding to Phakwe in two phases, beginning in 2018 when Phakwe acquired a 39% shareholding in Core Energy (RF) Pty Ltd. Following AIIM’s recent transaction, Phakwe has increased its total shareholding in Core Energy to 90%, making it one of the first majority black-owned and controlled IPPs in the South African REIPPP programme. 

Lebogang Pholoba, Investment Manager at AIIM, who led the deal, commented: “This marks AIIM’s second investment in Phakwe Witkop, and our 29th standalone investment in South Africa’s renewable energy sector. In addition to generating clean, reliable energy, we are tracking various indicators as part of our efforts to further local social and economic causes in Polokwane and the surrounding area. Our focus areas for this particular project include improving outcomes in early childhood education, developing school infrastructure and primary healthcare facilities.”

Since its foundation in 1999, AIIM’s IDEAS Managed Fund has completed 39 investments across a number of infrastructure sectors, and has delivered strong long-term investment returns and simultaneously achieved positive social and environmental objectives, in line with its mandate.

Niveshen Govender, COO of the South African Photovoltaic Industry Association (SAPVIA), which was formed to mobilise support for the sustainable growth of solar PV in South Africa, commented: “We have always believed that the path to sustainable growth must be inclusive. The Phakwe Power transaction represents the step change that is needed to transition the renewables sector away from a reliance on foreign investment and expertise, to a place where local industrialists - in particular black industrialists - serve to spur economic development with accompanying skills development and job creation.”

 

[ENDS]

 

ABOUT AIIM 

 

AIIM is a member of Old Mutual Alternative Investments (OMAI) and has been investing in the African infrastructure sector since 1999 with a track record extending across seven African infrastructure funds. AIIM’s team of 41 investment professionals is based out of five offices across the continent in Cape Town, Johannesburg, Nairobi, Lagos and Abidjan.

AIIM manages private equity funds which structure and invest in the financing of infrastructure projects and companies across the continent. AIIM currently manages USD1.9 billion in assets across the power, telecommunications, energy and transport sectors with operations in 19 countries throughout the continent. AIIM is one of the largest private investors in the power sector with power portfolio extending across renewable energy and thermal power assets with a combined generation capacity of over 2,800 MW. 

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