Spanish solar energy installer EiDF has taken a significant step toward securing funding for its 79.26-megawatt (MW) portfolio of solar photovoltaic projects in Spain. On Monday, the company announced the signing of a letter of intent (LoI) with an investor to enter into discussions about potential financing arrangements.
The LoI signifies the commencement of negotiations that could potentially lead to the establishment of a new company. Under this proposed arrangement, Spanish investment firm Atitlan Grupo Empresarial SL, based in Valencia, would hold a majority stake of 51%, with EiDF retaining the remaining 49%.
The talks are expected to result in an investment agreement, in which Atitlan would contribute up to EUR 38 million (USD 40.4m) in financing to acquire its majority stake and provide funding for the construction and operation of the projects within the portfolio. EiDF, in contrast, would contribute solar projects currently in development through several special purpose vehicles.
Both parties have set a deadline for finalizing the transaction by the end of 2023, contingent on various terms and conditions, due diligence reports, and internal approvals from both companies, according to EiDF.
Atitlan, a diversified business group, channels its investments in renewable energy through its platform Helios.
EiDF faced challenges earlier this year for not submitting its 2022 financial report to the market regulator by the end of the first quarter. In response, the regulator CNMV penalized the company by suspending EiDF shares from trading until the end of August. When trading resumed on August 28, EiDF's market capitalization reportedly decreased by EUR 1.2 billion, as reported by Reuters.
In September, the solar energy promoter took steps to raise up to EUR 20 million by agreeing to sell convertible debentures to Global Corporate Finance Opportunities 24 Ltd. These funds are intended to support the development of its various business units.