Installing solar panels. Photo: OregonDOT, licensed under CC BY 2.0.

Analysing UK renewable energy yieldcos

Choosing one renewable energy closed-end fund over another isn’t straightforward. The different yieldcos available differ in size, the type of clean energy they use, the management fee they take and the financial gearing they employ. I explored the universe of different renewable energy yieldcos in a previous post, identifying a number of different listed structures. This time around I want to look at some of the different attributes and metrics of six UK-based yieldcos. The difficulty in assessing these yieldcos comes in evaluating the importance of different measures. Is the effective dividend yield most important to you? Or perhaps you’re trying to assess the financial structure in place or determine how efficient the renewable portfolio is?

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Haynes Publishing: Going, going, gone!

Haynes Explains Pensioners
Haynes Explains Pensioners

It’s over a week since Haynes Publishing Group put itself up for sale, as detailed in an earlier post, and I wanted to discuss some elements of the formal sales process. Haynes decided to solicit offers for the company through the formal sale process framework as set out in the UK’s Takeover Code. “It provides some flexibility to offeree boards in managing an offer process where they have decided the company should be sold,” says Paul Arathoon, a partner with lawyers Charles Russell Speechlys.

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The universe of renewable energy YieldCos

Wind turbine in Glyndebourne by Mark Bridge, CC license:
Wind turbine in Glyndebourne by Mark Bridge, CC license:

I have long-believed in the necessity and potential for renewable energy, putting my money where my mouth was in 2012 via the Abundance Investment crowdfunding platform. My first investments were Padero South Downs and Resilient Energy Great Dunkilns. Padero South Downs aimed to provide free solar panels for residents in the UK’s South Downs region, however the project stumbled with the contractor being put into liquidation. Abundance decided this would create further delays and increase the risk to expected returns, so the debentures were paid back at par value. Resilient Energy Great Dunkilns (REGD) was more successful and its wind turbine continues to produce clean energy to this day, according to the project’s website. Abundance’s stake was eventually sold on to a local community benefit society and debenture holders received their capital back plus an 18 per cent premium calculated on the basis of outstanding capital. Over a six and a half year period REGD generated returns of 26 per cent or 4.01 per cent per year, although Abundance states an Internal Rate of Return (IRR) of 6.75 to 8 per cent variable. The difference here is probably due to my slightly more conservative calculation denoting a time period where my capital was in and then out, rather than when the investment officially closed and concluded. Nevertheless, for a single crowdfunded wind turbine, I thought this wasn’t a bad result.

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Iconic publisher of Haynes manuals up for sale

Founder John Haynes with a copy of Men's Cooking manual.
Founder John Haynes with a copy of Men’s Cooking manual.

Haynes Publishing Group have announced that the company’s directors have put the business up for sale. This comes ahead of the company’s 60th anniversary in 2020 and shortly after the death of founder John Haynes. As Friday’s RNS points out, the company has made a successful transition from the production and sale of the iconic Haynes car repair manuals to online services providing data for industry. Part of this transition has involved various bolt-on purchases as well as bringing the company into the 21st century through the use of technology. The 2016 purchase of OATS Limited helped Haynes add a lubricant database business, while buying E3 Technical in 2017 helped incorporate automotive data solutions.

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Codemasters in pole position on the grid

Screenshot of Mercedes car from F1 game by Codemasters
Screenshot of Mercedes car from F1 game by Codemasters

British video games company Codemasters announced on Thursday that it had extended the terms of its licensing agreement for the Formula One franchise until 2025. The F1 game is one of the company’s cornerstone products and signing an extension to the contract removes a fundamental risk for the business. It is one of the company’s most important products given the prestige the sports franchise provides and the opportunity for yearly game reboots with the start of each new season. More recently, Codemasters have launched an accompanying mobile game and eSports league, furthering the reach of the game.

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