( TF ) 11/16 08:00PM Iberian private-equity firm in 1.2 bln euro wind deal

LISBON, Nov 16 (Reuters) – A group of investors led by Iberia’s leading

private equity firm has bought Portugal’s largest wind power business, Enersis,

from Australian investment company Babcock & Brown Ltd for 1.2 billion euros.

Magnum Capital will take over a portfolio of wind farms with installed

capacity of 515 megawatts and 156 megawatts under construction.

The private equity firm said in a statement on Sunday that it was the

largest deal in the European wind energy sector ever done by a private equity

firm. It showed confidence remains in the alternative energy sector in spite of

the financial crisis sharply reducing investment in it in recent months.

“This transaction was concluded during the biggest global financial

crisis and highlights the consortium’s investment capacity at a particularly

complex moment,” the statement said.

Still, electricity produced by wind power is guaranteed in a fixed-tariff

regime for 15 years in Portugal, ensuring “that the income is not affected by

the current economic crisis.”

Magnum provided 65 percent of the financing for the purchase itself and

raised the rest through local institutional investors such as Espirito Santo

Capital, a part of Banco Espirito Santo bank, and a Nordic clean energy private

equity fund known as Fjord Capital.

Portugal and Spain have seen strong growth of wind power in recent years

and have two of the largest listed wind energy companies, Iberdrola Renovables

and EDP Renewables . Spain’s Gamesa is a leading producer of wind power


Investment in alternative energy has suffered during the global financial

crisis and there have been concerns in the sector that enthusiasm could wane,

especially now that oil prices are considerably off their record highs.

Enersis accounts for 25 percent of installed wind power capacity in

Portugal. The business is forecast to post sales of 120 million euros in 2008

and earnings before interest, tax, depreciation and amortisation of 100 million


(Reporting by Axel Bugge; Editing by Tim Dobbyn) Keywords: PORTUGAL


(Axel.Bugge@Reuters.Com, +351-213-509-201, Reuters Messaging: