Rasising money mega scale

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Financing for 70 wind turbines in the megawatt size range for installation in Lower Saxony over the next 15 months is the first project to be jointly undertaken by Bobikiewicz and Partner and Deutsche Structured Finance (DSF) since the start of their partnership at the beginning of the year. The investment to be made in the 70 turbines is unusually large for the wind business, the companies point out, adding that they have every confidence in the strength of their partnership and risk management strategy.

Bobikiewicz, a wind project developer and financier, has teamed up with DSF, based in Frankfurt am Main, to increase its financing scope. The deal is DSF's first in wind. The company, owned by the BFG Bank Frankfurt, which was taken over by the Swedish SEB bank at the start of the year, was created in 1996 by a group of employees who formerly worked in the airplane leasing department of the Deutsche Bank.

A two year co-operation agreement was clinched between DSF and Bobikiewicz and Partner in December 1999 for financing projects in the Emsland region of Lower Saxony in 2000 and 2001.

"We have the know-how from wind energy, DSF brings its experience from the world of airplanes and its international know-how. It's a mutual enrichment," says Jörg Bold of Bobikiewicz and Partner in Freiburg. "We want to be in a position to enter into partnerships with developers of larger projects, such as offshore stations and in projects abroad."

DSF's Manfred Kittelmann says airplane leasing typically requires the same scale of finance as a large wind station, about DEM 80 million. "Our aim is to get private and institutional investors interested in wind stations as an alternative to aeroplanes because returns are good. The environmental benefits are then an additional bonus." He adds that as wind projects get bigger, DSF has the resources to carry financing costs, which are around 30% of a project's cost, that the smaller Bobikiewicz might have difficulty with, Kittelmann says.

The next step for the Emsland projects will be to launch a public fund. A total of EUR 60 million (DEM 120 million) is being sought to cover the first phase of investment, the companies say. Fund investors will provide equity of EUR 20 million, and EUR 40 million will be borrowed from the post-war European recovery fund of the German development bank, the Deutsche Ausgleichsbank.

The first phase will be installation of 13, Enercon E66 1.5 MW turbines at Borsum and 12, E66 turbines at another, as yet unnamed site. Negotiations for supply of the remaining 27 turbines to be installed at Neudersum and Rhede are underway. Contracts for sites for another 18 turbines, to make up the 70, are on their way.

Risk reduction

The new fund will aim to reduce risk for investors, says Bold. "We hope to win over those who, until now, have only invested in property."

Bobikiewicz and Partner's confidence stems in part from a strategy begun in 1997, says Bold. That year the company trained 300 bank advisors working for the Volks and Raffeisen banks, part of the Süddeutsche Genossenschaft Zentrale (SGZ) in Frankfurt. About 50% of the investment in Bobikiewicz wind funds is dealt with by these banks, "By advisors who know what they are doing thanks to their training," Bold says.

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