BKW has bought 125 MW of Swedish wind farms from Eolus at an enterprise value of $206.24 million. That is the number in the headline. The share purchase price, the amount actually paid for the companies that own the projects, is $20.59 million. The turbines were still going up when the sale completed.
Key takeaways
- Eolus completed the sale of three Swedish onshore wind projects totalling 125 MW to BKW on 26 June 2023, at an enterprise value of $206.24 million, including a share purchase price of $20.59 million.
- The portfolio comprises Skallberget/Utterberget (79.2 MW, 12 Siemens Gamesa SG 6.6-170 turbines), Tjarnas (26.4 MW, 4 turbines) and Rosenskog (19.1 MW, 3 turbines), all in electricity price area SE3, with combined expected output of 332 GWh a year.
- Eolus manages construction on BKW's behalf under a Construction Management Agreement, with estimated revenues of about $32.14 million recognised over the remaining build period, and will provide long-term technical, operational and administrative services.
- At the time of the sale, construction was about 75 percent complete at Rosenskog and about 55 percent complete at Skallberget/Utterberget and Tjarnas; Eolus completed and handed over all three projects to BKW by 29 December 2023.
- The deal values the portfolio at $1.65 million per MW, near the top of the range for priced Swedish onshore wind transactions involving operating or under-construction assets that Enerdatics records between 2022 and 2024.
Why is the share price so much smaller than the enterprise value?
Because enterprise value measures the whole project, while the share price measures only what the seller is paid for the equity on the day. Enterprise value adds together the price of the shares and the other obligations a buyer takes on with them. In a project sold mid-construction, those obligations can be large: the cost of turbines already ordered, construction still to be paid for and any financing inside the project companies.
The share purchase price here is about 10 percent of the enterprise value. The record does not break down the remaining $185.65 million, so the post does not guess at its composition. What the gap does show is that the cash changing hands at signing was a small part of BKW's total commitment. Most of what BKW is paying for, it pays as the wind farms are built.
That structure suits both sides. Eolus crystallises its development value and shifts the remaining capital requirement to a buyer with a utility balance sheet. BKW gets near-complete assets without taking on the development risk that came before.
Why does Eolus keep building after it has sold?
Because the buyer is paying it to. A Construction Management Agreement is a contract under which the seller of a project keeps running its construction on behalf of the new owner, for a fee. Eolus had developed these projects and managed them through more than half of construction. Handing over a building site to a new team midway would add risk for little gain.
The agreement is worth an estimated $32.14 million in revenue to Eolus, recognised over the remaining build. Eolus will also provide technical, operational and administrative services for the wind farms on a long-term contract. In effect, Eolus sold the assets but kept a share of the work. BKW bought a portfolio that came with the team that built it.
It worked to plan. The three projects were 55 to 75 percent complete in June 2023, and all three were finished and handed over to BKW by the end of December 2023.
How does $1.65 million per MW compare with other Swedish wind deals?
It sits near the top of the range. Priced Swedish onshore wind deals involving operating or under-construction assets ran from $0.90 million to $1.68 million per MW between 2022 and 2024, once minority stakes are grossed up to 100 percent. BKW's price is second only to DWS Group's July 2024 purchase of the 48 MW Ljungbyholm wind farm at $1.68 million per MW.
A higher price per megawatt for these projects is consistent with what BKW bought. The portfolio uses modern 6.6 MW turbines, it sits entirely in price area SE3, and it was close to completion. The expected 332 GWh a year from 124.7 MW of nameplate is equivalent to a capacity factor of roughly 30 percent.
Enerdatics records 43 Swedish wind transactions announced between the start of 2022 and the end of 2024, of which 17 carry a disclosed value. Among the seven priced onshore deals for operating or under-construction assets, grossed up to 100 percent where a minority stake changed hands, the range runs from $0.90 million per MW for SCA's December 2022 purchase of the 85 MW Skogberget farm to $1.68 million for Ljungbyholm. The two other under-construction comparables are Greencoat's 134.4 MW acquisition from Enercon at $1.07 million per MW and MEAG's 75 percent stake in the 260 MW Stor-Skalsjon farm, bought from Eolus and Hydro REIN, which grosses up to $1.50 million per MW. One development-stage sale priced higher still: OX2's 115 MW Anglarna farm, sold to EWZ in September 2023 at $2.13 million per MW.
What does the deal signal for Swedish onshore wind?
It signals how Eolus prefers to monetise its projects: build them, sell them before completion and stay on as the operator. The same seller appears in the Stor-Skalsjon deal with MEAG, and it later sold another SE3 onshore wind portfolio to Mirova with a 15-year asset management agreement, and a 238 MW Dalarna wind project it co-developed to OX2.
For buyers, the attraction is near-operational capacity delivered by the team that knows the sites. The output is contracted: power from the projects will be sold to a major global energy company. For Eolus, the model recycles capital into the next project while keeping a recurring services income.
On financing, Enerdatics estimates that BKW funded the acquisition through debt and cash. The estimate rests on BKW's green bond issues in April 2022 of $222.95 million at a 0.875 percent coupon and $111.47 million at 1.125 percent, and its cash position of $863.78 million at 31 December 2022.
Frequently asked questions
How much did BKW pay Eolus for the Swedish wind farms? The transaction has an enterprise value of $206.24 million, including a share purchase price of $20.59 million. It covers three projects totalling 125 MW, or $1.65 million per MW.
Which wind farms did BKW buy from Eolus? BKW bought Skallberget/Utterberget (79.2 MW) in Avesta, Tjarnas (26.4 MW) in Hedemora and Rosenskog (19.1 MW) in Falkoping. All three are in Sweden's SE3 price area and use Siemens Gamesa turbines.
Who built the wind farms after the sale? Eolus managed construction on BKW's behalf under a Construction Management Agreement and handed over all three projects by 29 December 2023. It also provides long-term technical, operational and administrative services.
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