Stanlib’s Infrastructure Fund II acquires R1bn stake in Upington solar farm

Asset management Stanlib’s Infrastructure Fund II, which invests in infrastructure projects including renewable energy, transportation infrastructure, and logistics, is acquiring a 60% stake in a 285 megawatt (MW) solar power plant in Upington for R979 million.

The deal will see Stanlib acquire 45% and 18% stakes from Norwegian investors, Scatec and Norfund, respectively.

The deal, which is subject to customary approvals, is expected to close within the first of 2023.

The Upington solar farm, operated by Oslo-based Scatec, began operation in 2020 and is estimated to generate about 650 gigawatt hours (GWh) of power annually, which is sufficient to power about 120 000 households and save about 600 000 tons of CO2 emissions a year.

It comprises three 86MW solar photovoltaic (PV) projects.

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Greg Babaya, head of infrastructure investments at Stanlib, said the investment would foster economic growth, which is significant as South Africa faces worsening supply problems.

“It provides additional exposure to an asset class that is a strong tool to drive economic growth and makes a tangible difference to South African communities – particularly at a time when the country is suffering an acute shortage of power generation,” Babaya said.

Stanlib, part of the Standard Bank group, said Scatec will continue to provide operations and maintenance, and asset management support to the Upington solar complex.

“We are very pleased with this transaction and are confident that Stanlib will be a solid owner of the asset going forward,” Scatec CEO, Terje Pilskog, said.

Stanlib Infrastructure Investments, over its decade long history, has invested in 27 projects and currently has R11 billion in assets under management.