ENGIE and Meridiam have agreed to buy BTE Renewables from Actis for $1 billion. On paper it is one platform changing hands. In practice the two buyers will cut it in two at closing, along a national border. And the headline price per megawatt, which looks remarkably cheap, describes something quite different from what ENGIE is actually paying for.
Key takeaways
- ENGIE and Meridiam signed a sale and purchase agreement with Actis on 20 June 2023 to acquire 100 percent of BTE Renewables for a consideration of $1 billion, with completion expected by Q4 2023 subject to merger control clearance.
- BTE Renewables holds about 500 MW of operating wind and solar assets, five in South Africa and one in Kenya, plus a gross development pipeline of 5 GW of identified opportunities.
- At closing ENGIE will take 340 MW net of South African operating assets (150 MW onshore wind and 190 MW solar PV) and 3 GW of advanced development projects, while Meridiam takes 250 MW of wind and solar projects in operation and development in Kenya.
- The five South African assets sell power to Eskom Holdings SOC under 20-year PPAs, and Kenya's 100 MW Kipeto wind farm sells to Kenya Power and Lighting under a 20-year PPA, giving the portfolio a weighted average remaining contract life of 16.74 years.
- Actis acquired BioTherm Energy in 2019 and renamed it BTE Renewables in 2021, making this its second sale of an African renewables platform after Lekela Power, which it co-owned and agreed to sell in July 2022 at an enterprise value of $1.5 billion.
Why are two buyers splitting one platform?
Because they want different things from it, and the portfolio divides cleanly along those lines. A carve-out is a transaction in which part of a business is separated from the whole and handed to a different owner. Here ENGIE carves out the Kenyan assets to Meridiam at the moment of closing, so neither buyer ever holds the part it does not want.
ENGIE's half is a South African operating business with a large pipeline attached. Meridiam's half is a single operating wind farm in Kenya, a greenfield project beside it and some early solar opportunities. Meridiam is buying through The Meridiam Infrastructure Africa Fund II, so each buyer prices only the risk it keeps.
The Kenyan perimeter is small but complete. It comprises the 100 MW Kipeto wind project south of Nairobi, operating since July 2021, the 50 MW Siruai wind and storage project under development next to it, and 100 MW of additional solar PV opportunities. That adds up to the 250 MW Meridiam is taking.
What is ENGIE actually buying in South Africa?
A young, fully contracted fleet and a development book about nine times its size. The five South African assets are Golden Valley (123 MW wind, Eastern Cape), Excelsior (33 MW wind, Western Cape), Aggeneys (46 MW solar, Northern Cape), Konkoonsies II (86 MW solar, Northern Cape) and MBP (86 MW solar, Northern Cape). All but MBP reached commercial operation between July 2020 and May 2021.
A detail in the contracts explains ENGIE's 340 MW figure. The five Eskom PPAs cover 117.72 MW, 31.9 MW, 40 MW, 75 MW and 75 MW respectively. Those add up to 339.6 MW, almost exactly the net capacity ENGIE says it is acquiring, against 374 MW of gross nameplate. In other words, the operating business ENGIE is buying is best measured by what Eskom has contracted to take.
Those contracts also explain why the fleet is attractive. A weighted average operational life of 3.25 years means the turbines and panels are close to new, and a weighted average remaining contracted period of 16.74 years means most of the revenue is fixed for well over a decade.
Why does $0.18 million per MW understate the price?
Because the megawatt count includes capacity that does not exist yet. Leap's per-megawatt figure divides the $1 billion consideration across 5,500 MW: roughly 500 MW of operating assets plus the 5 GW gross pipeline. That arithmetic treats an identified opportunity and a spinning turbine as equivalent, which no buyer does.
Measured against the roughly 500 MW that is actually generating, the same $1 billion works out at about $2.0 million per operating MW. That figure overstates the price in the opposite direction, because it assigns no value at all to 3 GW of advanced South African development, which ENGIE clearly values. The true price sits somewhere between the two, and the consideration has not been split between operating and development value. The honest reading is that this is a platform acquisition, and per-megawatt arithmetic on a platform describes the denominator more than the deal.
Enerdatics estimates that ENGIE funded its share through a mix of cash and debt, and that Meridiam drew on institutional capital. The estimate rests on ENGIE's cash position of $19.5 billion at 31 March 2023 and undrawn credit lines of $1.31 billion at 31 December 2022, and on Meridiam acquiring through its Africa Fund II, which was targeting $818.9 million at the time.
Enerdatics records 32 renewable energy transactions in South Africa announced between the start of 2022 and the end of 2024, and only eight of them carry a disclosed value. The two largest of those eight are both sales of African renewables platforms with Actis on the sell side: Lekela Power at an enterprise value of $1.5 billion in July 2022, and BTE Renewables at $1 billion eleven months later. Lekela, which held 1,184.7 MW of operating wind across South Africa, Senegal and Egypt, prices at $1.27 million per MW on Leap's measure. Its farms Noupoort, Loeriesfontein 2 and Khobab later had their debt refinanced by Infinity Power.
What does the deal signal for South African renewables M&A?
It signals that the exit route for private equity platforms in South Africa is a sale to strategic owners rather than a listing or a piecemeal asset sale. Actis built two platforms through acquisition and development, and sold both whole within a year: Lekela to Infinity Group and Africa Finance Corporation, BTE to ENGIE and Meridiam. In both cases the buyers were investors with the balance sheet to take the development pipeline forward, not only the operating assets.
It also suggests that the development book, not the operating fleet, is becoming the prize. ENGIE is taking 3 GW of advanced projects in South Africa against 340 MW of contracted operating capacity. A buyer that wanted only yield would not need the pipeline. A buyer that wants to build into South Africa's procurement rounds needs both: operating assets that prove it can deliver, and permitted projects ready to bid. Later deals point the same way, including A.P. Moller Capital's agreement for full ownership of Mainstream's South African platform.
Frequently asked questions
How much did ENGIE and Meridiam pay for BTE Renewables? The consideration is $1 billion for 100 percent of BTE Renewables, under a sale and purchase agreement signed with Actis on 20 June 2023. The split of the consideration between the two buyers has not been disclosed.
What does Meridiam get from the BTE Renewables deal? Meridiam takes the Kenyan assets, which ENGIE carves out to it at closing. They comprise the 100 MW Kipeto wind farm, the 50 MW Siruai wind and storage project in development and 100 MW of solar opportunities, 250 MW in total.
Who buys the power from BTE Renewables' South African projects? All five South African assets sell to Eskom Holdings SOC under 20-year PPAs, covering 339.6 MW in total. The portfolio has a weighted average remaining contracted period of 16.74 years.
Ready to get deal-ready answers in seconds? Try Enerdatics Leap AI and access verified intelligence across M&A, financings, PPAs, projects, and energy market developments through natural language.
.jpeg)
