Our team advised the state-owned energy company Ignitis Group on entering the Latvian renewable energy market.
Ignitis renewables, a subsidiary of the Ignitis Group, has entered into conditional agreements to acquire 100% of the shares of three Latvian companies developing wind farm projects in Latvia. Construction of wind farms with a total capacity of about 160 MW should start in 2024–2025, and commercial activity should start in 2025–2027.
Will invest up to EUR 200 million
The total preliminary sum of investments will be up to EUR 200 million. The acquisition price for these projects will not exceed 10% of the total investment amount. Payment of the acquisition price depends on the achievement of the development stages established in the agreements.
The completed projects will operate under market conditions.
Plans to increase Green Generation portfolio to 4 GW by 2030
Darius Maikštėnas, CEO of Ignitis Group, says: “Latvia is one of the strategically important markets for us and the acquisition of these projects is the result of the consistent implementation of the group’s strategy. We plan to consistently increase our Green Generation portfolio and reach 4 GW of installed capacity by 2030, and so we will continue to actively seek development opportunities in the Baltic states and Poland.”
The signed agreements stipulate that the sellers will have to develop the power plant projects before the construction stage, and that after obtaining the building permits, they will have to transfer the shares to Ignitis renewables. For the Ignitis Group, this will be the first project in the Green Generation segment where the developers of the purchased parks will continue to be responsible for their development. Ignitis renewables will be actively involved in decision-making, and once the developers obtain building permits, it will look for contractors for the construction of wind power plants.
Our services and project team
The Sorainen team, led by partner Sergej Butov (Lithuania) and senior associate Viktorija Smirnova-Čerkasa (Latvia), assisted Ignitis Group in this transaction by providing a regulatory overview of the Latvian market, assisting in the course of legal due diligence on the particular wind park projects and drafting the transaction documents. We also represented and assisted the client in negotiations and in the execution of the share purchase agreement.
