Brookfield to acquire Neoen for €6.1 billion

The takeover bid would begin with an acquisition of a 53.32% shareholding from investors, including investment holding company Impala and Fonds Stratégique de Participations (FSP), an investment vehicle owned by seven French insurance companies.

Neoen’s board unanimously welcomed the proposed transaction when it met on 29 May, with chairman and CEO Xavier Barbaro quoted as saying the company was “thrilled to open a new chapter in Neoen’s history, with the arrival of Brookfield as our majority shareholder.”

“Our board of directors fully welcomes the transaction and sees Brookfield as a partner of choice to preserve the structure and identity of Neoen in the best interests of its employees and its stakeholders,” Barbaro said.

Mandatory cash tender offer to follow initial 53.32% stake

Brookfield would acquire Impala and other investors’ shares at €39.85 (US$43.10) per share, which Neoen noted was a 26.9% premium over its closing price. As of 29 May, Neon’s shares were trading at €31.40, more than double the €15.29 listed in October 2018, but well below a January 2021 peak of €57.76.

After the block acquisition of just over half the total shares, a mandatory cash tender offer for outstanding shares would be filed by Brookfield Renewable Holdings at the same price per share, along with outstanding convertible bonds issued in 2020 and 2022 at adjusted prices.

The deal values the French IPP at a total of €6.1 billion, and the tender offer is anticipated to be completed in the first quarter of 2025, pending regulatory approvals that Brookfield said it expected to receive by Q4 of this year.

Brookfield Renewable, which contributes to the investment group’s Brookfield Global Transition Fund II and is its biggest investor, intends to invest up to half-a-billion Euros in the acquisition.

Major player in Australia’s energy storage market

Both Brookfield Renewable and Neoen have significant portfolios of renewables and energy storage assets.

Brookfield Renewable has close to 34GW of operational capacity and a claimed 157GW development pipeline including a recent government tender win for a combined 400MW of battery energy storage system (BESS) projects in Ontario, Canada; investments and ownership in large-scale BESS projects in the UK; the US$650 million acquisition of US developer Urban Grid, which had 7GW of BESS development projects at the time of Brookfield’s investment in 2022; and ownership of European BESS developer X-ELIO.

Meanwhile Neoen’s combined capacity of operational and in-construction projects is 8.3GW and is targeting to reach 10GW by the end of 2025.

In February, Neoen completed AU$1.1 billion debt financing for a 1.5GW portfolio of solar PV and energy storage assets in Australia, where the company has become a key player in the utility-scale BESS market.

It was the developer behind the Hornsdale Power Reserve in South Australia, which was for a while the world’s largest lithium-ion (Li-ion) BESS at 100MW/129MWh when commissioned in 2018 (it has since been expanded to 150MW/194MWh).

Neoen also delivered the 300MW/450MWh Victorian Big Battery in the state of the same name, and currently has other projects in the country in construction or development including the 200MW/400MWh Western Downs Battery in Queensland, another 400MWh project in South Australia, and is currently building a 2.2GWh project in two phases in Western Australia’s Collie region.  

It has also been building some of the European Nordic region’s biggest projects, including a 2-hour 56.4MW/112.9MWh BESS in Finland, and a 93.9MW/93.9MWh project in Sweden targeting the Nordic ancillary services markets.

Its solar and wind portfolio meanwhile includes Finland’s biggest wind farm at 404MW, the 300MWp Cestas Solar Park in France – again, the country’s biggest – and a 375MWp PV plant in Mexico among its notable assets.