Longroad Energy Holdings has found a buyer for its 238 MW Rio Bravo project in Starr County, Texas.
The buyer is Sammons Renewable Energy, a renewable energy investor and developer with a focus on projects in the U.S., Canada and Mexico with a minimum threshold of $40 million. SRE in turn is a subsidiary of Dallas-headquartered Sammons Infrastructure.
Franklin Park, Sammons’ asset manager, will also oversee the Rio Bravo investment on behalf of the company.
The project is to be fitted with 66 Vestas 3.6 MW turbines and brought online by the summer of 2019. It has a 15-year hedge from Citigroup Energy.
KeyBanc Capital Markets acted as financial adviser to Longroad on the sale of the project and was also coordinating lead arranger on an associated $200 million construction loan (PFR, 6/1). The construction loan bridges to a tax equity commitment from a subsidiary of Berkshire Hathaway Energy.
Total construction costs for the project are estimated to be about $300 million, of which Longroad was expected to provide $100 million in the form of equity.
Akin Gump acted as legal adviser to Sammons and Franklin Park on the deal, while Leidos provided engineering advice to both parties. Longroad will provide operations and maintenance services for the project once it is online.
Rio Bravo is Sammons' second wind farm acquisition, bringing the capacity of its wind portfolio up to 400 MW. Its overall renewables portfolio totals more than 800 MW.
“This project expands our footprint in the ERCOT South region and should provide operational and financial synergies,” said Tom Tribone, ceo of Franklin Park, in a statement. “We look forward to continuing to identify and acquire compelling renewable power projects in North America in order to continue growing the portfolio.”
Longroad is mostly owned by New Zealand's Infratil and the New Zealand Superannuation Fund, each of which holds a 45% stake. The remaining 10% is held by the company’s management team.
Brett Prior, vice president at Franklin Park in Boston, declined to disclose the financial terms of the transaction. Paul Gaynor, ceo of Longroad, also in Boston, did not respond to inquiries by press time.