The Company announces that today it agreed to acquire 100% of shares in ENERGO-PRO Turkish Development, s.r.o. (“EP Turkish Development”) from the Company’s sole shareholder, DK Holding Investments s.r.o. (“DKHI”). EP Turkish Development holds 100% of indirect ownership rights over the Karakurt dam and hydropower plant (“Karakurt”).
Karakurt is located on the Aras River in Türkiye and has total installed capacity of 97 MW. The transaction is expected to close on or around 10 January 2025. The purchase price is EUR 100 million and will be settled on a non-cash basis by a set-off against the corresponding amount of the Company’s receivables against DKHI, which arose as a result of distributions in prior periods. To assist in determining the fair market value of EP Turkish Development, the Company engaged PricewaterhouseCoopers Česká republika, s.r.o. to produce an independent valuation report.
Jakub Fajfr, Chief Executive Officer, commented: “This transaction represents another important milestone in the implementation of our strategy. Karakurt HPP, a 97 MW hydropower asset constructed and successfully operated by our parent company, DKHI, benefits from US dollar denominated YEKDEM Feed-in-Tariff of USD 73 per MWh for all its production. Additionally, this year the hydropower plant will also receive a local content bonus of USD 23 per MWh on top of the YEKDEM tariff. Moreover, it offers the flexibility to enhance profitability through the provision of ancillary services. Integrating Karakurt into the ENERGO-PRO group will boost our green electricity generation capacity, revenues, and EBITDA. This acquisition provides a natural hedge to ENERGO PRO by adding US dollar-linked cash flows to match our existing USD-denominated bonds as well as EUR-denominated debt to match our existing EUR-linked cashflows. The Karakurt debt also carries a lower interest cost. Over time, with its EBITDA generation potential and the amortizing profile of its debt, we expect this asset to have a positive impact on our net leverage. Finally, but importantly, this transaction is structured as a set-off and involves no cash consideration.”
About Karakurt
Karakurt is owned by Bilsev Enerji Üretim ve Ticaret A.Ş. (“Bilsev”), which is wholly owned by EP Turkish Development, a 100% subsidiary of DKHI. 1 2 Karakurt is located on the Aras River within the borders of Kars province of the Sarıkamış district in Eastern Anatolian Region of Türkiye. Bilsev holds a generation license for Karakurt valid until 24 February 2060. Karakurt includes a dam with a height of 137 metres. A provisional acceptance certificate from the General Directorate of State Hydraulic Works (Devlet Su İşleri Genel Müdürlüğü, “DSI”) in respect of the dam body was issued on 16 October 2020. The surface powerhouse of Karakurt is equipped with 3 vertical axis Francis turbines and generators, together providing a combined installed capacity of 97 MW. The generation units of Karakurt were granted provisional acceptance certificates by the Ministry of Energy between 26 October 2020 and 16 December 2020.
