Terra Firma set to launch Rete Rinnovabile sale – sources

11 Jan 2017 – Terra Firma will launch the sale of Italian solar business, Rete Rinnovabile (RTR), this month, a source familiar and four sources briefed on the situation said.

Terra Firma was awaiting the results of a 6 December Italian court hearing regarding an appeal by other solar operators to change the tariff that determines solar returns in Italy, according to a Mergermarket report in December.

The court rejected the appeal a day later, according to a law firm report.

Barclays has been mandated to sell the unit, the first two sources briefed said. But according to the third and fourth sources briefed and a person familiar with the situation, an appointment has yet to be made and is expected this week.

Barclays had been shortlisted alongside Lazard, according to the previous Mergermarket report. SocGen and Jefferies are also on the list of shortlisted banks, the source familiar added.

Barclays, SocGen and Jefferies declined to comment.

A final round of talks with banks was conducted at the end of last year, and a decision on an advisory mandate was expected early in the New Year. But it remains unclear if this has yet to be confirmed, the third source briefed said. A decision is likely this week, the source added.

KPMG has been hired to conduct vendor due diligence, the first source briefed on the situation added. KPMG declined to comment

Several companies have positioned themselves as interested in buying the portfolio, the second and third sources briefed said. They include F2i and Enel’s [BIT:ENEL] solar joint venture, both sources said, as well as Tages and Quercus, the second source briefed added.

Enel, F2i and Tages declined to comment. Quercus did not respond to a request for comment.

The asset is valued between EUR 1.4bn and EUR 1.6bn, according to a person familiar with the situation. However, the source familiar with the situation and the first source briefed on the process said RTR could be valued at between EUR 1bn and EUR 1.2bn.

Terra Firma acquired RTR in 2011 for EUR 641m of debt and equity, according to its announcements. At the time of the deal, the company had installed capacity of 144 MW, and since then it has acquired a further five portfolios, seeing its capacity grow to 318 MW, according to Terra Firma’s website.

Terra Firma declined to comment.

by Katie McQue, Patrick Harris and Micaela Osella

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