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A new investment trust focused on renewable energy generating assets in the UK and Europe is looking to raised up to £200mln as part of an initial public offer.
Downing Renewables & Infrastructure Trust PLC (LON:DORE) on Monday said it planned to float in London and build a portfolio of wind, solar, hydro and geothermal assets, along with other infrastructure assets.
Targeting an initial dividend yield of 3%, the trust will focus on delivering a sustainable income streams and capital growth by diversifying the portfolio by technology as well as by geography, project stage and revenue.
“By constructing a truly differentiated portfolio in this way, we reduce our dependency on any one renewable energy resource, any single jurisdiction and any one set of policies and regulations,” said Tom Williams, head of energy and infrastructure at the fund’s investment manager, Downing LLP.
Downing and some of its managed funds have pledged to invest £20mln as part of the IPO, with a further £10mln of commitments from existing Downing clients.
DORE’s fund managers have also identified and expect to secure an option to acquire a near-£50mln seed portfolio of over 90 MW of operational UK solar projects that generated an underlying profit of £9.9mln in the year to 31 March 2020.
The fund would join several other renewables-focused trusts on the London Stock Exchange, including a handful of specialist solar and wind funds, plus others focused on battery storage.
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