H1 Holdings concludes R2.6bn Equity Transaction

H1 Holdings has partnered with Nedbank and Absa (acting through their respective Corporate and Investment Banking divisions) together with British International Investment (BII) and Norfund, to reach financial close on a long-dated R2.6bn equity funding solution. The transaction facilitates the partial exit of the Existing Investors, which initially enabled H1’s acquisition of equity, alongside Pele Green Energy, in a portfolio of five wind projects with Enel Green Power (“H1 Pele Wind”).

The return of significant capital to the Existing Investors highlights the roles played by BII and Norfund in bringing long-term capital into South Africa’s renewable energy sector.

According to Saad Ul Islam, Investment Director at BII, “BII is proud to enable Africa’s energy transition and support our partners like H1 in achieving this.” Bjørnar Baugerud, Head of the Norfund-managed Climate Investment Fund, added, “The success of 'H1 Pele Wind' shows what can be achieved when credible developers are supported with flexible, well-structured impactful funding.” Beyond this deal, H1 has a longstanding partnership with BII and Norfund, who remain investors in its renewable energy platform, H1 Capital.

As part of the transaction, H1 also completed the exit of Pele Green Energy's equity in 'H1 Pele Wind', resulting in H1 assuming full ownership of the investment vehicle. According to Matthew Wainwright, Chief Financial Officer at Pele Energy Group, “Our partnership with H1 has been an important contributor to strengthening South Africa’s renewable energy ecosystem and this transaction represents a natural progression in that journey.” He added, “The conclusion of this deal enables Pele Green Energy to redirect capital into the next wave of projects that expand generation capacity, deepen localisation and accelerate South Africa’s just energy transition.”

While the H1 Pele Wind transaction involved numerous workstreams and stakeholders, the banks’ long-dated investment was core to the transaction. Nedbank and Absa developed an innovative solution that accommodated the transaction’s complexity and evolving requirements.

According to Jayshree Padayachy, Principal in the Leveraged and Diversified Finance team at Nedbank, “Working with a sophisticated sponsor like H1 allowed us design a structure suited to a multi-party transaction and draw on our leveraged and energy finance expertise.” Nikhil Kasiram, Principal in the Resource and Project Finance team at Absa CIB, added, “Absa is pleased to have supported H1 on this strategic transaction, providing funding aligned to the long-term performance profile of the assets. This transaction underscores Absa’s unwavering commitment to strong partnerships and delivering meaningful energy-sector expertise to our clients.”

“We are grateful to our investors in securing new substantial and sustainable investment,” said Reyburn Hendricks, Chief Executive Officer at H1. “This process brought together multiple stakeholders and demonstrates how H1’s disciplined asset management, quality projects and experienced investors can align around a long-term solution that ultimately allowed us to grow our proud partnership with Enel Green Power.”

The 'H1 Pele Wind' portfolio consists of five wind farms (Karusa, Soetwater, Oyster Bay, Garob and Nxuba) procured in Bid Window 4 of the Renewable Energy Independent Power Producer Procurement Programme. With 713MW of operating capacity, the projects can collectively produce 2.7 TWh of energy per annum and are expected to avoid approximately 2.54 million tons of CO2 emissions annually.