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Renewables developer Neoen launches IPO to raise €640M, deliver 7.4-GW pipeline

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Renewables developer Neoen launches IPO to raise €640M, deliver 7.4-GW pipeline

French energy company Neoen SA is planning to raise €640 million through an initial public offering that would make it one of only a few listed renewable-only operators in Europe.

The company said in an Oct. 4 news release that it will raise 450 million of new capital while two of its fund shareholders will sell existing shares worth 190 million. The Euronext Paris listing will enable it to develop its ambitious project pipeline, the company said. It first floated plans for the IPO in September, still hoping to raise only €450 million.

"Neoen is a fast-growing company, with capacity in operation and under construction of 2 GW and additional secured capacity of more than 1 GW, as well as a robust portfolio of 7.4 GW of projects in development," Neoen CEO Xavier Barbaro said in a statement.

"Our initial public offering enables us to raise funds to finance the construction of these new projects and to pursue the rapid growth of our business: we are targeting total capacity in operation and under construction of at least 5 GW by the end of 2021."

Reuters reported that the company's market capitalization following the IPO would be approximately 1.4 billion to 1.5 billion.

The company would join a small club of listed European renewable operators, including Denmark's Ørsted A/S, Spain-headquartered EDP Renováveis and France's Voltalia SA. At home, Neoen also competes with market leaders Electricité de France SA and ENGIE SA.

Neoen said the new shares will be priced at 16 per share to 19 per share, with the offer running from Oct. 4 to Oct. 15. The price will be fixed Oct. 16 and formal trading will start Oct. 19, with a free float of an estimated 30% of stock.

The company's majority shareholder, former commodities trading executive Jacques Veyrat's holding company Impala, will buy approximately €170 million of shares to retain its stake. Several others have also agreed to subscribe for a combined €132.5 million in shares.

"These are powerful votes of confidence, from well-reputed players, that will contribute to the success of the offering," Barbaro said.

If the IPO sees high demand, the total offer could be boosted to €711.5 million by shareholders including Impala and Bpifrance SA offering additional shares, Neoen said.

Neoen operates solar, wind and storage projects in Europe, Australia, Africa and the Americas, and wants to maintain at least 80% of its installed capacity in Organisation for Economic Cooperation and Development countries, according to the company. Its portfolio includes Europe's most powerful solar photovoltaic farm, a 300-MW project in France, as well as a 100-MW lithium-ion battery project in Australia developed with Tesla Inc.