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German asset manager snaps up three UK onshore wind farms

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EUROPE - German insurer Munich Re’s asset management arm has acquired three UK onshore wind farms for “low three-digit euro millions” from Ridgewind, a subsidiary of private equity firm HgCapital.

MEAG Munich Ergo acquired the farms, which include the UK’s largest onshore wind farm near Manchester, and one each in Lincolnshire in North Wales, for its Renewable Energies and New Technologies (RENT) programme.

The programme, which has a target size of €2.5bn, invests primarily in European wind and solar assets with a view to developing new insurance vehicles.

Munich Re effectively acts as both a risk carrier and an investor.

A spokeswoman for MEAG said the UK remained an attractive market for emerging energy investments, citing among other factors “favourable wind conditions”.

The asset manager, which has funds under management totalling €10.4bn, last month acquired six German wind farms for an undisclosed price.

“Both [the German and UK] markets show stable economic, regulatory and legal framework for investments in renewable energy projects, with well predictable future returns,” the spokeswoman said.

Up to now, the RENT programme’s investment focus has been on solar assets.

Its acquisitions last year included a Spanish solar plant acquired from Banco Santander and a four-asset Italian portfolio.

MEAG also took a 37% share in an Italo-Spanish portfolio of more than 40 assets, with operator Grupo T-Solar as its majority shareholder and KKR Infrastructure Fund acquiring a 12% interest.

The spokeswoman acknowledged declining prices in both sub-sectors, with variable availability based on market and technology.

Munich Re has targeted renewable energies as a means of diversifying its portfolio, generating stable and predictable returns, and matching assets to liabilities.

According to its most recent annual report, equity, debt and short-term fixed income investments, at €178.3bn, make up the greater part of its portfolio.

Its write-downs on Greek securities alone totalled €1.2bn last year.

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