Cambridge Power

CHALLENGE

Cambridge Power (‘CP’) had built a strong pipeline of over 1GW of Battery energy storage and Hybrid Solar sites in the UK. After successfully selling a land portfolio of 400MW in 2020, which proved the nascent investor interest in supporting the UK’s transition towards renewable energy generation, they wished to consider the most appropriate strategy to support their future growth and maximise their risk-adjusted returns. As a result, CP mandated Savills Capital Advisors (‘SCA’) to produce a strategic options analysis.

SOLUTION

After assessing, modelling and soft marketing a variety of options, SCA proposed a Joint Venture structure, where CP take the land, planning, grid connectivity and construction cost risk, whilst the JV shares the operational risk.

The proposed structure allows CP to generate greater upfront profits, both in terms of cash payments and equity co-investment in the JV, compared with their historic deal. It also provides for long-term fee streams via an Asset Management role and a meaningful promote, allowing CP to benefit from the long-term growth of the JV and sector, rather than just selling the land at a point in time in a rapidly developing market.

RESULTS

SCA ran a highly competitive process, with CP ultimately selecting Brookfield Asset Management - one of the world’s largest alternative investment managers, as their Joint Venture partner. The JV has a short-term ambition to deliver at least 800MW of battery energy storage and hybrid solar sites across the UK, as well as much larger long-term ambitions.

TESTIMONIAL

“We initially met with Joe and Sam at Savills Capital Advisors (‘SCA’), to discuss our current strategy and to explore how this could be optimised to drive value and better achieve our objectives. SCA presented a range of strategic options and worked with us to identify a few to investigate further. Following detailed financial analysis and soft market testing led by SCA, we agreed on a Joint Venture being our preferred option to market.

"SCA quickly produced high quality marketing materials, efficiently managed investor engagement, drove exceptionally competitive bidding rounds in a nascent market and provided expert advice on the heads of terms and throughout the legal process, managing this landmark transaction smoothly through to completion.

"It was a pleasure working with SCA and we would thoroughly recommend them for their invaluable advice, collaborative, flexible and detail orientated approach and ability to rapidly apply themselves to a range of sectors, all of which sets them apart from their competition. We look forward to working alongside Joe and Sam as we develop and grow our renewable energy storage business.”

Giles Hanglin, CEO, Cambridge Power