Talanx leads financing in Germany’s biggest offshore wind project

The parent company of Hannover Re and HDI, Talanx Group, is financing Germany’s biggest offshore wind farm as part of its sustainability investment strategy.

Talanx affiliates purchased €321 million of the €511 million project bond for global investment manager CPP Investments (Canada Pension Plan Investment), which together with Canadian energy company Enbridge holds 49.9 percent of the shares in the projects. Majority shareholder of the wind farm is EnBW, Energie Baden-Württemberg AG with a shareholding of 50.1 percent.

Two wind power facilities located in the North Sea were combined in a single project under one project bond - “Hohe See” (497 MW) and “Albatros” (112 MW). The wind parks, which are in operation and connected to the electricity grid, will together generate enough electricity to supply 710,000 households.

Following its debt solutions for Gode Wind 1 (2015) and Borkum Riffgrund 2 (2017), this is the third large-scale offshore wind financing that has been structured and accompanied by Talanx. Overall, Talanx-led structured finance transactions in the German offshore wind sector exceed €1.9 billion to date.

“Following on from Gode Wind 1 and Borkum Riffgrund 2, this transaction once again demonstrates that Talanx can structure and finance large-scale and complex transactions in the alternative investments space,” said Peter Brodehser, head of infrastructure investments at Talanx. “Moreover, we have found partners in CPP Investments and Amscap who possess exceptional international expertise and reputation in the area of large-scale infrastructure investments. We are consistently driving our strategy forward with the aim of further enhancing and diversifying the proportion of infrastructure assets in our investment portfolio.”

Michael van der Heijden, co-founder of Amscap, commented: “This was another milestone in offshore wind HoldCo refinancing. The appetite for project bonds is increasing and this transaction shows the strong alignment of interests between buy-and-hold lenders and long-term sponsors and that, if managed correctly, the timelines – including the rating – do not exceed those when using bank debt. This transaction also demonstrated that even complex governance arrangements typical to HoldCo financings are not an impediment to putting in place an attractive financing package.”

In December 2019, Talanx acquired two major solar farms in Spain. This acquisition was geared towards supporting the transition to emission-free energy supply. In addition to solar and wind farms, the Talanx portfolio includes other alternative investments such as social facilities, electricity grids, transport and gas caverns.