Repsol will enter the U.S. onshore wind market with an acquisition of renewable power company ConnectGen for $768 million. (Source: Shutterstock)
Spain’s Repsol will enter the U.S. onshore wind market with an acquisition of renewable power company ConnectGen for $768 million, the global energy company said Sept. 7.
The acquisition of Houston’s ConnectGen from Quantum Capital Group’s 547 Energy comes as Repsol continues to reorganize its portfolio while working to grow its installed renewable generation capacity to 6 gigawatts (GW) by 2025 and 20 GW by 2030.
ConnectGen, a subsidiary of 547 Energy, has 278 megawatts of solar projects in operation and more than 20 GW of wind, solar and energy storage projects in development across the U.S.
“The addition of ConnectGen accelerates our commitment to renewable generation in one of the markets with the greatest potential for future growth,” Repsol CEO Josu Jon Imaz said in a statement. “In that sense, bringing on board its valuable team of experts is key to ensure our successful future growth with robust profitability in the market.”
Word of the acquisition came a day after Repsol moved to shed some oil and gas assets, agreeing to sell its Canadian oil and gas upstream business to Calgary-based Peyto Exploration & Development Corp. for $468 million.
Some oil producers, including Repsol, have been venturing into renewable energy and low-carbon energy space amid the global push to reduce emissions to slow global warning. Some are investing in carbon and emissions technology, while others are diversifying into critical materials, solar, wind and energy storage.
Repsol said it wants to strengthen its position as a global renewable energy player. The company’s latest renewable energy acquisition follows its 2021 purchase of a 40% stake in Hecate Energy, a U.S.-based photovoltaic solar and battery storage project developer. The deal marked the Spanish company’s entry into the U.S. renewables market.
In the U.S., Repsol is targeting an installed capacity of 2 GW by 2025 and more than 8 GW by 2030. Repsol plans to incorporate ConnectGen’s team, including management, into its renewables arm.
“All of us at Quantum and 547 Energy are looking forward to watching Repsol convert these development projects into operating assets that will help power the American economy with clean renewable electricity over the next decade,” Quantum CEO Wil VanLoh said.
Repsol said its existing global renewables portfolio has more than 2 GW of projects in operation and 3 GW either under construction or in development in Chile, Italy, Spain and the U.S.
The ConnectGen deal is expected to close in fourth-quarter 2023 subject to customary regulatory approvals.
Guggenheim Securities LLC served as financial adviser to Repsol, while Wells Fargo Securities LLC and Nomura Securities International Inc. served as financial advisers to Quantum, 547 Energy and ConnectGen.
Baker Botts LLP served as legal counsel to Repsol, and Kirkland & Ellis LLP served as legal counsel to Quantum, 547 Energy and ConnectGen.
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