Legal & General have announced that it has provided close to £300 million in support of Danish pension funds, PKA and PFA consortium’s £2 billion purchase of 50% of Walney Extension from Ørsted (the former Dong Energy).
Walney Extension, which is currently under construction, will be the world’s largest offshore wind farm with a capacity of 660 megawatt (MW), providing enough power for over 590,000 homes.
The acquisition represents Legal & General’s first debt investment into UK offshore wind sector.
The deal was financed by LGIM Real Assets on behalf of their clients, including Legal & General Retirement (LGR). LGR was the principal investor for LGIM Real Assets on this transaction, providing £250 million of the circa £300 million of long-term acquisition debt.
The Walney Extension offshore wind farm will be located in the Irish Sea, around 19 km west of the Walney Island coast in Cumbria.
Approximately £1 Million per month was contributed to the local economy during the construction of Walney I and II.
It is also estimated that for the Walney Extension Project, Ørsted could support up to 185 full-time jobs annually throughout the estimated 25 year operational lifespan.
Charles-Henry Lecointe, Senior Investment Manager, LGIM Real Assets, said: “This deal represents our first offshore wind investment for LGIM clients.
“We have a strong appetite for future investments into this sector as well as other renewable sectors, recognising the importance the offshore wind industry can have for providing clean energy and stimulating job growth in the UK.
“Legal & General continues to be committed to investing in key UK infrastructure assets which will have a major impact on stimulating economic growth while ensuring long-term cash flow for pension funds.”