SWS to invest €500m in natural resources arm

The Cork-based SWS Group is planning a €500 million investment in its natural resources arm in a bid to make it the biggest wind-energy provider in Ireland within five years.

SWS announced yesterday that it had raised €100 million from private and institutional investors to help fund its expansion programme in what is currently a hot sector with investors.

Institutional backers of the equity and bond fundraising included Anglo Irish Private Banking.

The fundraising will be leveraged by debt to bring the total investment to about €500 million.

The company said the expansion would bring its renewable energy production capacity to 500 megawatts, which is capable of providing power to about 325,000 homes.

SWS has acquired the rights to eight wind farms over the past six months, with combined capacity of 208 megawatts. In addition, SWS has 100 megawatts of capacity already in operation or close to coming on stream.

Its activities are mostly located in Munster.

The Bandon-based company said it was already "highly profitable" and would achieve earnings before interest, tax, depreciation and amortisation of €12 million this year.

SWS was acquired in December by Dublin-based Ion Equity, a private equity player that also controls Topaz Energy, which owns the Statoil and Shell chains of petrol stations.

Since Ion took ownership, SWS's natural resources division has been separated from the group's outsourced services business. The division comprises SWS's wind arm and its activities in biomass, waste to energy and forestry services.

Neil O'Leary, Ion Equity's chief executive, said the market for wind energy would "grow strongly in the months and years ahead" in Ireland. SWS was well positioned to benefit from this.

SWS's biggest rival in the wind-energy market here is Airtricity, currently the biggest wind-energy provider in Ireland. Airtricity's biggest shareholder is NTR, which also has interests in waste, toll roads and water.