Tenaga Nasional Berhad (TNB)’s wholly-owned subsidiary, Vantage RE Ltd. (Vantage RE) has completed its acquisition of a 100% stake in a 97.3MW onshore wind portfolio in the United Kingdom (UK) from a number of funds advised by Capital Dynamics, for GBP145.9m (or c.RM805.7m). This is consistent with the Group’s strategy to expand its renewable energy portfolio. We understand that post-completion of the new assets, Vantage RE‘s total operational RE capacity will grow by 23% from 433MW to 530MW. This comes as no surprise as TNB already indicated in its recent result briefing that it is looking at a potential acquisition of new asset in UK which is expected by 2Q 2022. Pending more details, we keep our earnings unchanged for now. Our Outperform call is retained with an unchanged DCF-derived TP of RM12.42.

• Another milestone for TNB’s renewable energy (RE) journey. To recap, TNB’s RE footprint in UK and Europe renewables space started in May 2021 when it acquired a 500kW Feed-in-Tariff (FiT) turbine in the UK. TNB has also successfully acquired a 49% stake in Blyth Offshore Demonstrator Ltd (BODL), an offshore UK wind farm company in October 2021, with existing floating offshore wind capacity of 41.5MW and further development rights for similar type of RE of up to 58.4MW. The formation and establishment of Vantage RE Ltd which was completed on July 1, 2021 is seen as a vital component to grow TNB’s RE capacity/portfolio with immediate growth plan to focus on the acquisition of subsidised Renewable Obligation Certificates (ROCs) and FiT assets across the UK and Ireland.

• Vantage RE’s Capacity to grow by 23%. With the completion of its acquisition of this 100% stake in the UK, Vantage RE‘s total operational RE capacity will grow by 23% from 433MW to 530MW. The assets are being acquired from a number of fund vehicles advised by Capital Dynamics, an independent global private asset management firm and one of the world’s leading clean energy investors for a total consideration of GBP145.9m (equivalent to RM805.7m).

Source: PublicInvest Research - 5 Apr 2022