PNE looks to increase profits through subsidiary

GERMANY: PNE Wind has announced measures to raise capital for a new profitability drive following rating agency Euler Hermes's call in April for the company to be more efficient in its development of onshore wind projects.

PNE aims to use the funds to accumulate a larger number of commissioned onshore wind projects, initially within a new subsidiary company, dubbed yieldco.

However, it will sell all or some of these shares in this subsidiary to investors by the end of 2016. The aim is "to realise a majority exit from the subsidiary as profitably as possible," the company said.

PNE Wind will increase its share capital by up to EUR 22.8 million and will issue a 3.75% interest bearing convertible bond amounting to a total nominal value of up to EUR 25.575 million.

This will mature in 2019, allowing PNE to use the net proceeds from both capital measures — or at least the major part — to finance its equity share to build onshore wind farms in Germany and possibly abroad.

Euler Hermes had given PNE Wind a "BBB–" rating with outlook "negative" on 10 April. It said PNE needed to increase efficiency in terms of developing onshore projects in order to generate the returns and cashflow corresponding to the size of the company.