The sale has been agreed at £68.1 million subject to a customary condition precedent.
The AD Portfolio is located in the East of England and the AD assets have been operational since 2013 – 2016. JLEN said that the projects in the AD Portfolio benefit from a RHI and Feed-in Tariff subsidy.
JLEN will continue to own 49% of the original AD Portfolio, which has a combined generating capacity of 38MW, as well as its interests in three further AD assets which are not part of the agreement.
Future Biogas is a specialist developer and has operated the assets since they were first acquired by JLEN.
Ed Warner, chair of JLEN, said: “This deal is a great outcome for JLEN, enabling us to recycle capital within the portfolio, while continuing to benefit from the future growth and income generated by this attractive AD Portfolio. This is the Company’s second divestment, following the sale of our French wind assets in January 2022, and provides funds for JLEN to commence buybacks in accordance with our stated approach to capital allocation.
“We are pleased to continue our partnership with Future Biogas who we have worked with since 2017. Having them as co-owners will help to deliver further value from the business model they have developed and put into practice on other projects for post-subsidy operations. Anaerobic digestion projects such as these have a valuable role to play in the decarbonisation of heat as part of the UK’s net zero goals.”
Plans for the proceeds
JLEN has said that the proceeds of the sale will be used to repay debt and consider share buybacks. The company will allocate £20 million of the proceeds to a share repurchase programme.
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