Renewable Energy M&A: ~$400mn offshore wind M&A, Ocean Winds buys Shell’s stake in the SouthCoast Wind project off the Massachusetts coast

~$400mn offshore wind M&A: Ocean Winds buys Shell’s stake in the SouthCoast Wind project off the Massachusetts coast

🌊 Transaction Details: Ocean Winds (an EDPR and ENGIE venture) acquires a 50% stake in the 2.4 GW SouthCoast Wind offshore project, at an estimated enterprise value (EV) multiple of ~$0.3mn/MW

🚀 Asset specifics: The project is in its early stages of development, with two 20-year PPAs granted in 2021. However, these contracts were terminated in Oct'23 due to challenges related to project economics.

💡Deal Valuation: Enerdatics estimates the EV multiple at ~$0.3mn/MW, equating to a transaction EV of ~$360mn, based on precedent deal multiples

🔍 Comparative Analysis: In May’23, Orsted acquired Bay State Wind, which has the potential for 4 GW of power and includes an 800 MW wind farm in early development. The deal fetched a price of $625mn, translating to a multiple of $0.31mn/MW. The estimate for Ocean Wind's acquisition reflects a nuanced analysis of both projects' similarities and unique aspects.

📈 Future Outlook: Both the SouthCoast Wind and Bay State Wind assets are poised to bid in this year's offshore wind procurement round, with commercial operations anticipated in 2030.

The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation. 

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