BlackRock Increases Shares in Vestas, EQT Acquires OX2

Renew Holdings purchases Full Circle for £50M, following the UK
decision lift restrictions on offshore wind. BlackRock's holding of
voting rights and share in Vestas has increased to 7.59%. And EQT
has acquired renewable developer OX2 for $1.58 Billion. Sign up now
for Uptime Tech News, our weekly email update on all things wind
technology. This episode is sponsored by Weather Guard
Lightning Tech. Learn more about Weather Guard's StrikeTape
Wind Turbine LPS retrofit. Follow the show
on Facebook, YouTube, Twitter, Linkedin and visit
Weather Guard on the web. And subscribe to Rosemary Barnes'
YouTube channel here. Have a question we can answer on the
show? Email us! Pardalote Consulting -
https://www.pardaloteconsulting.comWeather Guard Lightning Tech -
www.weatherguardwind.comIntelstor - https://www.intelstor.com Allen
Hall: I'm Allen Hall, president of Weather Guard Lightning Tech,
and I'm here with the founder and CEO of IntelStor Phil Totaro and
the Chief Commercial Officer of Weather Guard Lightning Tech, Joel
Saxum. And this is your News Flash. Newsflash is brought to you by
our friends at IntelStor. If you want mar, ket intelligence that
generates revenue, then book a demonstration of IntelStor at
intelstor.com. Renew Holdings and engineering service company base
in Leeds has purchased full circle. Group Holding BV, a Dutch firm
specializing in onshore wind turbine repair and maintenance. The
acquisition, valued at 50 million pounds, was funded through
Renew's existing resources and banking facilities. This move
follows the new labor government's decision to lift restrictions on
new onshore wind projects in England. Well, UK government changed
and they have become more proactive on onshore wind. That made a
nice little market for all the repair companies in the UK to be
gobbled up by larger players. Philip Totaro: Yeah, precisely, and
at the end of the day Full Circle is one that already has a lot of
contracts in place on the aging fleet, so there are going to be
repowering opportunities in addition to new build in, both Lower
England, Scotland, Wales, et cetera. So you're, you're going to see
a company like Full Circle continue to thrive, but all the other
O& M shops and, and independent service providers over there
are going to start probably getting a lot more attention and
potentially work if you start seeing more build out in the market.
The funny thing about the UK is even a lot of the, well in Ireland
you'd have to say too, a lot of the new build, doesn't always get
the OEM full service agreement. So they've tended to rely a little
bit more on the independent service providers in that market,
again, particularly for the older assets. So, this is a, it's, I
guess it's a good time to be in the The service and repair
business. Joel Saxum: I think you're going to continue to see a lot
more of this happen. We've been talking about for the last few
years is this market consolidation of these smaller ISPs. And I say
smaller, but 50 million or 50 million pound acquisition is not a
small acquisition. So full circle repairs, but having those
contracts in place makes them attractive for an acquisition. So I
know that you've seen some, there's been some larger ones scooping
up and buying up and buying contracts and a little bit of mark
margin compression and things over there in that market. I would
still continue to look for, like, Renew Holdings. I don't know
anything about the internal workings of that company, but I would
bet this is not their last acquisition. And you've seen other large
groups doing the same thing. Mulahan and some others. So, keep
watching that space. Especially, like Phil, like you said, as the
Labour Party has lifted that moratorium on work in the, in the UK.
Allen Hall: Vestas has disclosed a notification from BlackRock
regarding a change in its group structure. Following the
acquisition of Global Infrastructure Management, BlackRock's
holding of voting rights and share capital in Vestas has increased
to 7. 59 percent from a previous 5. 36%. The change is effective as
of October 1st, with BlackRock now controlling over 1. 5 billion
voting rights attached to shares in Vestas. Phil, thank you.
Obviously Vestas is a really strong leader on the OEM side in wind.
And Blackrock is pushing heavily into renewables. This acquisition,
in a sense, does make sense from BlackRock's standpoint, but does
it create issues for Vestas? Philip Totaro: Well, it's interesting
because the global infrastructure management acquisition was really
more about the asset ownership and development pipeline and
portfolio. BlackRock also, as you mentioned, already had a 5
percent market share. Holding in Vestas as a supply chain company,
while these infrastructure investment companies have largely
focused on the asset ownership and the project development
pipeline, they're starting to look a little more critically at the
supply chain, particularly the OEMs, but also you've seen,
Infrastructure investors making acquisitions on vessel owners and
operators. We just talked last week about Macquarie Group and, and
Zyton. But where, where this comes into play for, the turbine OEMs
is a company that really doesn't tolerate, financial losses.
Getting involved in a supply chain company that has struggled, at
times with, profitability and the fact that they're going to be
increasing their, their shareholding here, it's, it's not enough to
necessarily get them, a seat on the board or anything like that.
And it's not necessarily enough for them to have anything more than
just kind of minor influence. However, it's indicative of the fact
that you're probably going to see more investment funds start
getting a little more vertically integrated in terms of the scope
and scale of their investments. Joel Saxum: Yeah, I think this is,
this is BlackRock who, BlackRock knows how to make money. They're a
trillion dollar hold, plus holdings company, right? So they're,
they're, what they're doing here is hedging their bets that they've
already made. Like the bet they made in Global Infrastructure
Partners as an operator developer, now they're making sure that
they're getting a little bit deeper involved in what that supply
chain is going to be, what that OEM looks like. And like I said, or
like Phil said, BlackRock does not tolerate losses. So. As the
shares start to grow, you could see some changes at some of these
OEMs. Allen Hall: Swedish private equity firm EQTAB has finalized
its tender offer for OX2AB. a Stockholm based renewable developer.
The deal values OX2 at approximately 1.58 billion U. S. dollars.
EQT's investment vehicle, Otello Bitco AB, has secured a 98. 81
percent stake in OX2. The acquisition is expected to be settled
around October 16th, with OX2 applying for delisting from the
NASDAQ Stockholm by the end of October. Phil, this is a unique deal
up in Sweden. There seems to be more activity happening in Sweden
lately economy is right there. What is the next step for EQT as
they move forward with this acquisition? Philip Totaro: EQT
infrastructure has been getting involved in a lot of renewables
projects. We keep talking on Newsflash about these infrastructure
funds, plowing money into renewables and in different places around
the world. This Swedish infrastructure fund. Is backing, basically
one of Sweden's biggest private non utility developers and OX2 has
a huge pipeline of operational projects as well as developmental
assets that obviously EQT wants wants a piece of and, the, the
thing that we, Kind of gloss over and I hope it's not lost on on
all of our viewers and listeners is in the current market
environment where project developers may struggle for access to
capital a company like equity has already done a lot of fundraising
and has capital at their disposal to spend on. Helping projects get
get developed and getting the pipeline moving. So this is a play on
the part of an infrastructure investor where, they do see, even
though a lot of oil and gas companies or other Companies have have
pulled out of renewables investments. A company like EQT wants to
be able to plow money in because they see returns. And particularly
with OX two, X two's expanded beyond Scandinavia to the point where
they now have a reasonable portfolio throughout parts of Europe,
including Poland. So, OX two's a, a player and they want to, wants
to be a part of that. Joel Saxum: Yeah, what, what OX2's plans look
like for the future, backed by EQT now, is to evolve from more of a
developer, which you see in Sweden a lot. You see a lot of
financial asset owners up there, where it's a company that comes
in, they have the money, they just, buy a project, they sit back
and they run it on an FSA or something of the sort. You're going to
see OX2, which they have done that in the past. You're going to see
OX2 evolve into more of an integrated renewable developer and asset
owner. So look for them to be more involved in their projects in
the future with, bringing engineering support and those kinds of
things as well. Which is a, will be a market change from that
Swedish market. And, and just to follow Philip Totaro: up real
quick on that, the OX two's been a developer in the past that's
basically followed like the build and transfer type of business
model where they've sold off a lot of the, the early stage and late
stage assets that they've developed to someone else who's gonna own
it. And then they may be involved as company that's gonna help
operate. But this gives them, as Joel just mentioned, more of an
opportunity to be further integrated. So I think this is a really
savvy play on their part.