In West Africa, a commercial and industrial (C&I) solar power provider Starsight and Chapel Hill Denham Nigeria Infrastructure Debt Fund (NIDF) have announced the successful closing of a N3.6 billion ($9.2m) senior debt facility.
This C&I local currency transaction represents the first time that a solar power-based energy company in Nigeria has been successfully backed by long-term Naira financing.
The facility is aimed at supporting the rapid growth of climate-friendly solar-hybrid energy solutions for C&I customers across Nigeria.
Starsight will use the 10-year facility to substantially expand its existing portfolio that includes banks, gas stations, schools, hospitals, agricultural companies, and other large C&I customers.
Anshul Rai, the CEO of NIDF, commented: “By eliminating the FX risk and aligning the debt profile with that of the underlying assets, our financing enables Starsight to de-risk its business model and position itself for aggressive growth.”
Milestone for C&I local currency market
The closing of the debt facility marks another major milestone for both Starsight and NIDF.
It combines Starsight’s technology and deep in-house engineering capability with NIDF’s ability to provide long-term Naira denominated debt financing crucial to ensuring the long-term viability of clean energy projects in Nigeria.
Starsight has completed over 500 sites in Nigeria since 2015. The company currently has 36MW of installed generating capacity and 28MWh of storage across Nigeria and Ghana.
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NIDF has a current capital base of 60 billion Naira and a track record of financing more than two dozen infrastructure projects since its inception in 2017.
The NIDF chief executive, concluded: “As the costs of clean energy solutions become more affordable, combining them with the right type of financing is the key to achieving rapid and massive expansion of these solutions in Nigeria and across Africa.”
The fund is in the process of closing its seventh series of fund raising, which will include the participation of the African Development Bank and increase the fund’s capital base to more than 80 billion Naira.
Tony Carr, Starsight’s CEO, also commented, “We are excited to announce the closing of this new debt facility with one of Nigeria’s largest providers of infrastructure financing. Starsight will use these funds to cement our position as Nigeria’s leading provider of C&I solar solutions.”
He added: “Our partnership with the NIDF, in addition to our equity investors Helios Investment Partners and Africa Infrastructure Investment Managers and debt investors Norfund and Finnfund, affirms Starsight’s strong financial position which enables our continued growth and consistent performance.”