ICO participates in the sustainable corporate financing awarded to Bruc for the construction of photovoltaic and wind power generation plants in Spain
06 October 2023
- The financing agreement is worth a total of EUR 600 million
- The ICO's contribution totals EUR 75 million, together with six other entities
- This finances its wind farm portfolio with a production capacity of 8,500 MW of installed power
- The financing agreement has been signed under the formula of corporate finance meeting ESG criteria and complies with the Green Loan Principles of the LMA (Loan Market Association)
The Instituto de Crédito Oficial has participated in an operation of sustainable corporate financing awarded to Bruc Energy SL (Bruc), the parent company of a major Spanish renewable energy producer. The financing agreement worth a total of EUR 600 million guarantees a substantial part of the contributions necessary for the investment in the construction and commissioning of a portfolio of photovoltaic and wind power plants in Spain totalling 8,500 megawatts (MW). The funding will cover the needs in the different phases of construction of photovoltaic parks and wind farms and focuses on the target of reaching around 5.3 GW in operation by 2025.
The ICO has participated with EUR 75 million, in its capacity as structuring institution together with the following six entities: Santander, ING, BNP Paribas and Intesa Sanpaolo (as bookrunners and MLAs) and Schroders Capital and Infranity (as MLAs). Astris Finance served as financial advisor, Allen & Overy as legal advisor to Bruc, and Linklaters as legal advisor to the financiers.
The financing agreement was concluded under the formula of "corporate sustainable financing", given that the entities have taken into account the ESG (Environmental, Social and Governance) criteria. The financing is in line with the Green Loan Principles of the LMA (Loan Market Association). Bruc's positioning in the clean energy sector was already key for the pension funds OPTrust and USS to get a share of the company's capital in 2016 and 2021, respectively.
More recently, in June this year, through its infrastructure investment fund Inter Infrastructure Capital (IIC), Interogo Holding (IH) agreed to acquire 49% of a portfolio of 1,066 megawatts (MW) of solar power generation assets in operation and under construction by the BRUC group. Its strategy is to acquire shares in infrastructure companies that provide essential services to society, are recession-proof and provide downside protection through stable and predictable cash flows.
With these contributions, Bruc will finance from the group's parent company the construction of renewable power plants totalling 8,500 MW in the autonomous communities of Aragon, Andalusia, Extremadura, Castilla-La Mancha and Castile and León. Thanks to hybridisation processes, this portfolio of assets includes photovoltaic and wind power plants. Bruc is also developing several renewable energy storage projects.
The ICO promotes the financing of renewable energy projects that support the green transition, in accordance with the ICO Group's 2022-2027 Strategy and the Recovery, Transformation and Resilience Plan. In the last two years, the ICO has approved financing of more than EUR 2 billion for renewable energy projects promoted by Spanish companies, such as solar plants, wind farms — both onshore and offshore —, hydrogen and biomass infrastructure, and projects in energy efficiency and saving.
Bruc is one of the largest and most dynamic renewable energy groups in Spain. Bruc's assets are located in Spain and Japan. In Spain, it has 8,500 MW of photovoltaic and wind power plants, all of which have access to the transmission grid, while in Japan it manages 100 MW of solar generation. Bruc's presence in Japan dates back to the start of its activity, when it identified investment opportunities in a market whose regulations ensure revenues from clean energy generation.
About the ICO
The Instituto de Crédito Oficial (ICO) is the Spanish national promotional bank attached to the Ministry of Economic Affairs and Digital Transformation. It supports innovative and sustainable business projects in Spain and other markets by providing loans and other forms of financing, thereby contributing to sustainable growth. As a national sponsorship bank, it offers financing to businesses, particularly SMEs and the self-employed.
The ICO integrates sustainability as a broad foundation of all activity, focusing its activity notably on the promotion of sustainable projects, both from a social and environmental point of view, in line with its Strategy 2022-2027 and within the framework of the Recovery, Transformation and Resilience Plan. In 2022, the ICO participated with more than EUR 2.2 billion in operations that will mobilise an investment of EUR 15.931 billion in environmental and social projects.