Saturday, September 29, 2007

Global Firm Takes Majority Stake in Bluewater Wind

An offshore wind power farm is an expensive thing to build. Bluewater Wind's proposed installation off the shore of southern Delaware is estimated to cost about $1.6 billion.
Up to now, Bluewater Wind has been operating as a start up firm, using its initial capital to try to create opportunities to build wind power projects here, or in Rhode Island or on Long Island. Now that its in serious negotiations to build the first offshore wind farm in the U.S., it needs access to the big bucks. The News Journal reports that global investment firm Babcock & Brown has taken a majority stake in Bluewater Wind. An important consideration in entering into a long term project of this magnitude is the company's financial strength. This deal with Babcock & Brown should provide the financial assurance needed to make such a long term project viable.
Babcock & Brown, which is listed on the Australian Stock Exchange, reports $52 billion in assets under management in real estate, infrastructure and project finance, operating leasing and structured and corporate finance.
It's a smart way to get the capital Bluewater needs to move forward. If the company had gone public, its investors would have sought a hefty risk premium for this first of its kind project. But the $1.6 billion that Bluewater needs represents just three percent of Babcock & Brown's project investment portfolio. The project risk is tempered by Babcock & Brown's large capitalization and experience in project management. This deal is an important step forward for a project hat once seemed like a long shot at best.


Anonymous Anonymous said...

With 52 billion in assets, they should scoop up Delmarva, be done with it, and begin building.....

8:12 AM, October 01, 2007  

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