As financial services provider Absa continues on its mission to support solutions that contribute towards a sustainable future, the bank has provided advisory services and financing for another landmark deal in the South African energy sector.

Absa Corporate and Investment Banking has assisted in Infinity Power Holding’s (IPH’s) acquisition of Lekela Power.

IPH is a joint venture (JV) between Abu Dhabi-based energy company Masdar and Egypt-based Infinity Group established in 2020.

The JV targets solar and wind generation projects, at utility-scale as well as commercial and industrial scale, in Africa.

In turn, Lekela has operations in South Africa, Senegal, Egypt and Ghana, and was sold by private equity company Actis and renewable energy company Mainstream Renewable Power.

The acquisition of Lekela will see IPH gaining access to 2.8 GW of wind power assets in operation and in development, and become the largest renewable energy provider in Africa.

For the transaction, Absa acted as debt and joint merger and acquisition adviser, as well as sole mandated lead arranger on the rand acquisition financing facility and joint mandated lead arranger on the dollar acquisition financing facility.

The transaction has been recognised by industry participants as “market defining” and won the Catalyst Private Equity Deal of the Year 2022 award at the Ansarada DealMakers Annual Gala Awards, in February.

“The multiproduct client solution encompassing the three pillars of our investment banking franchise – financing, capital raising and advisory services – was made possible by our deep industry insight into the renewable energy sector, pan-African multi-jurisdictional financing expertise, experience in executing large and complex deals, as well as our leadership in advising international businesses on acquisitions in Africa,” says Absa MD and Absa Securities UK investment banking co-head Hasnen Varawalla.

He adds that Absa is privileged to have advised and financed IPH on the acquisition of the pan-African Lekela renewable energy portfolio in the largest-ever transaction of its kind in the sector, on the continent.

IPH chairperson Mohamed Ismail Mansour says that, with the JV having successfully finalised the Lekela acquisition, the parties will build upon this milestone to reach a target of installing and operating 2 GW of greenfield projects by 2025.

“With this transaction, we have delivered on the promise made during COP27 of being the fastest-growing renewable energy company in Africa. We continue to drive efforts that reduce carbon emissions, increase renewable energy sources, and develop efficient energy solutions for the entire region.

“This transaction underscores our commitment to promoting sustainability in the energy sector and attracting international investment into Africa,” he concludes.