Written by: Basant El-Farmawy
Scatec and the European Bank for Reconstruction and Development (EBRD) have agreed to establish a new investment platform dedicated to renewable energy projects in Egypt, providing financing and financial commitments reaching $221 million.
Under the share purchase agreement concluded between the two parties, Scatec will retain a 60% stake in the new investment entity, while the EBRD will own a 40% stake.
The funding provided by the European Bank is distributed as approximately $170 million in equity contributions, with the remaining amount allocated to provide guarantees at the level of various projects.
The new platform aims to accelerate the pace of development and financing of Scatec's near-term renewable energy projects in the Egyptian market, and it is scheduled to acquire varying ownership stakes in a number of prominent projects.
The list of targeted projects includes acquiring a 40% stake in the Obelisk project, a 51% stake in the Shadwan project, in addition to stakes of approximately 60% in each of the Egypt Aluminum project phase one known as Dendera, and the Energy Valley project, with the participation of other investors with smaller stakes.
This initiative combines Scatec's expertise as a developer, provider of engineering, procurement, and construction services, and asset manager, with the financial and knowledge support provided by the European Bank in the local market.
Terje Pilskog, CEO of Scatec, emphasized that Egypt has become one of the company's most important markets, noting that this platform reflects the scale of achievements and the quality of the assets developed, as well as the role of the partnership with the European Bank in bringing institutional capital to accelerate regional growth plans.
This partnership is expected to support the energy transition path in Egypt, as well as represent a potential model for replicating similar experiences throughout the region in the coming period.
For his part, Harry Boyd-Carpenter, Managing Director of Sustainable Infrastructure at the EBRD, explained that the investment in equity represents a pivotal step to enhance energy security in Egypt and expand access to clean and reliable energy sources.
