In another landmark transaction in the Asia-Pacific renewable energy sector, Deutsche Bank has helped arrange the financing for the acquisition of a 50% stake in an offshore wind far in Taiwan. Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) and local investor Cathay PE have agreed to acquire the stake in the Greater Changhua 1 Offshore Wind Farm for US$2.68 billion.
It is the largest offshore wind M&A transaction ever announced in Asia-Pacific and the second-largest offshore wind M&A transaction for an asset globally.
This is the first time that Ørsted’s partnership model, previously used for European offshore wind financings, has been used for an offshore wind financing in Asia-Pacific.
The transaction comprises the acquisition, construction and operation of a 605MW offshore wind farm in the Taiwan Strait, developed by Ørsted.
Ørsted will manage full construction of the project as EPC (engineering, procurement and construction) contractor using Siemens Gamesa’s wind turbines, and provide long-term operation and maintenance services.
The project is expected to be completed in 2022 and will benefit from a 20-year fixed-price power purchase agreement with state-owned Taiwan Power Company, supplying green power to over 650,000 households.
Deutsche Bank acted as mandated lead arranger and sole hedge arranger for the financing of the transaction. The bank also acted as sole rates hedging coordinator for the transaction and exclusively arranged pre-financial close rates hedging for Ørsted.
This is the third time the bank has supported clients with innovative hedging solutions in the Taiwan offshore wind sector, with previous transactions winning numerous industry awards.
Deutsche Bank also supported Ørsted in opening Taiwan’s green bond market when it issued the first-ever Taiwan green bond by a foreign corporate in 2019.