Following completion of the deal, Seriti will own 51% of Windlab Africa, which has a 3.5GW portfolio of wind and solar projects at different stages of development in South Africa and east Africa.
Windlab Africa managing director Peter Venn (15%), RMB (14.5%), Standard Bank (14.5%) and Ntiso Investment Holdings (5%) will hold minority stakes in the developer.
Windlab Africa is the African arm of Australian renewables developer Windlab. The parent company is also active in wind farm development in North America and Australia.
Seriti is a major coal player in Africa and claims that a third of state-owned utility Eskom’s electricity comes from its coal. However, last year it set up a renewable energy unit – Seriti Green – to diversify into wind and solar.
It explained that introducing renewable energy into its portfolio will provide “long-term financial stability and diversification”. The transaction will also enable Seriti to use Windlab projects to power its coal mining operations.
Seriti CEO Mike Teke said: “We need to be moving towards a lower carbon future through investing capital from coal into green energy. It is not only the right thing to do, but it makes business and societal sense.”
Windlab Africa CEO John Martin added that Seriti’s investment will help to accelerate the development of its renewables pipeline.
The transaction is due to complete by the end of 2022.
South Africa has faced weeks of intermittent, hours-long blackouts as utility Eskom’s ageing fleet struggles to meet demand.
President Cyril Rampahosa recently announced plans to put renewables at the heart of his strategy to prevent the national-level rolling blackouts. South Africa plans to double the capacity available in the country’s next renewable energy tender and ensure previously contracted wind and solar projects can start operations as soon as possible, he said.