SDCL Efficiency Income Trust sells assets at discount to cut debt
SDCL Efficiency Income Trust PLC on Friday said it has agreed to sell a portfolio of assets at a discount to carrying value in order to reduce debt.
The investor in energy efficiency infrastructure assets said it will sell the portfolio to Kyotherm SAS for an enterprise value of up to about £105 million, including an up to £4 million earnout over the next three to five years.
SDCL Efficiency said the sale price represents a 9% discount to the carrying value of the portfolio as of September 30. As a result, the disposal will reduce net asset value per share by 1.2 pence.
NAV per share was 87.6p on September 30. The company on Friday said it will provide in June the NAV for its financial year-end of March 31. There is no change to its target dividend for financial 2026 of 6.36p, it said.
SDCL Efficiency shares were down 2.7% to 44.18 in London on Friday morning. It has a market capitalisation of £480.0 million.
Kyotherm is a Paris-based investment company that provides financing for decarbonised heat and energy efficiency projects.
The portfolio of assets sold includes SDCL Efficiency’s interests in ‘Capshare Future Energy Solutions (asset portfolios), Sparkfund, Moy Park Biomass, Tallaght Hospital, Baseload, Lycra, SEEIPL, Northeastern US CHP, CPP Biomass, Supermarket Solar UK and GET Solutions’, it said.
SDCL Efficiency said the disposal is part of its push to reduce gearing through asset sales and to streamline its portfolio to focus on commercial and industrial customers.
The company aims to reduce its debt level to about 65% of NAV. Gearing was 71.9% in September on £683 million in debt.
‘The board’s intention remains to reduce gearing and generate portfolio liquidity. However, the sale of a high yielding asset portfolio, at even a modest discount to NAV and which has taken longer than anticipated, illustrates the challenges of achieving disposal activity at reasonable valuations,’ commented Chair Tony Roper.
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