Foresight Solar Fund has agreed a £100 million ($168.2 million) debt facility to help fund its plans to double its operating capacity over the next 12 months.
The Foresight Group, which recently relocated from Sevenoaks in the UK to bigger offices in London, said the fund has reached financial close for the facility with three banks – RBC, RBS and Santander.
The fund had outlined plans to agree such a facility when it raised £150 million through floating on the London Stock Exchange in October.
The first asset that will be acquired using this debt facility will be the 37MW Kencot, Oxfordshire, solar farm which is currently under construction backed by utility RWE.
Foresight said it expects to repay the debt facility by using excess dividend cover, further equity issuance and/or refinancing with a long-term debt facility.
The solar fund has to date invested 88% of its net initial public offering (IPO) proceeds in 100MW of operational UK solar assets.
The remainder of the proceeds will be exhausted with the acquisition of the 10.7MW Hunters Race solar farm in West Sussex which is expected to be operational later this summer. The farm will qualify under the Renewables Obligation regime, before the subsidies are changed to less generous Contracts for Difference (CfD) payments in April.
"The company continues to see a strong pipeline of assets becoming available for acquisition and expects to double its operational capacity in the coming 12 months, which today's announcement will facilitate," Foresight said in a statement.
Foresight also confirmed it is on track to deliver a target dividend of 6p per ordinary share in respect of its first financial year, after which it will rise annually with inflation as measured by the retail price index.
Peter Cripps