Mainstream given €26m loan for wind farm project

MAINSTREAM RENEWABLE Power has raised €26 million in a loan note for investment in a number of wind farm projects.

The company was set up by Eddie O’Connor last February following the sale of wind energy business Airtricity.

The loans, which will be matched by equivalent equity from Mainstream, will be used for a range of projects including two planned wind farms in Chile.

Fintan Whelan, Mainstream’s chief financial officer, said the company had hoped to raise up to €50 million through the loan note.

“It is a tough time in a tough market to raise money. We launched in October and when we cut it off at the end of the year there was €26 million in the door at that stage.” The loan note was structured and arranged through Dolmen Corporate Finance.

He said Mainstream had €62 million in equity available for investment. The fact that less money was raised than intended will not delay any of Mainstream’s projects, Mr Whelan said.

“You always want a cash cushion for the unexpected; some money on hand for opportunities that will present themselves – and they will in this market.”

Mainstream Renewable was set up by Mr O’Connor and Mr Whelan using some of the €50 million Mr O’Connor received from the sale of wind energy group Airtricity to Scottish and Southern Energy.

In June the company said it planned to seek €200 million in funding from private backers and institutions in a fundraising drive. Mainstream said the equity it has raised includes €20 million from Barclays Capital for a 14.6 per cent stake.

Mr Whelan said the company was planning a further equity fundraiser in the second quarter.

“We will go and secure our funding for what we anticipate we need. We have an ongoing development project pipeline and the funds we require depend on what stage our projects are at.”

He also suggested recent declines in the price of oil had in no way diminished the business case for developing power from renewable sources. “Wind is the most speedily deployable way of generating energy at scale. The price of oil has gone down but this is likely to be a relatively short-term reaction to the economic slowdown and people’s view of what’s in prospect,” he said.

Mainstream has development projects in the US, Canada, South Africa, Australia, the UK and Germany.