DUBAI — Infinity Power, a joint venture between Egypt’s Infinity and the United Arab Emirates' renewable energy company Masdar, said on Monday it has completed a full acquisition of African wind power platform Lekela Power, in what it’s calling Africa’s biggest renewable energy deal.
The value of the deal was not disclosed, but Infinity Power said in a press release that the transaction was funded through equity investment from shareholders and debt from Absa Corporate and Investment Banking (Absa CIP) and Mauritius Commercial Bank (MCB).
However, in July of last year, Africa Finance Corporation (AFC) and Infinity Group said they planned to raise $4 billion to double the size of a recently acquired business that’s already Africa’s biggest renewable power company, according to Bloomberg.
Infinity’s main stakeholders include AFC and the European Bank for Reconstruction and Development (EBRD).
Mohamed Ismail Mansour, chairman of Infinity Power, said that with this deal the company will target installing and operating 2 gigawatts (GW) of greenfield projects by 2025. The company currently has an operational capacity of 1.3 GW, with projects in South Africa, Egypt, Senegal and Ghana.
“With this transaction, we have delivered on the promise made during the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP27) of being the fastest-growing renewable energy company in Africa,” he said. This deal kick starts the second phase of Infinity Power’s plan to increase renewable energy sources and develop efficient energy solutions for the African region, particularly in underserved and energy-insecure communities.
Masdar CEO Mohamed Jameel Al Ramahi reinforced this idea and added that it has the opportunity to utilize Africa’s tremendous renewable energy potential.
“Greater access to clean energy will enable African nations to develop their economies sustainably while meeting their climate objectives – in alignment with COP28’s goal of delivering inclusive climate progress,” said Ramahi. COP28 will be held in the UAE capital at the end of this year.
Announcing Africa’s Biggest Renewable Energy Deal.#InfinityPower, a joint venture between 🇪🇬 Infinity & 🇦🇪 #Masdar, has completed the acquisition of Lekela Power. This makes Infinity Power Africa's largest pure play renewable energy company. pic.twitter.com/rpJE0oTRqX— Masdar (@Masdar) March 20, 2023
President-designate of the COP28 climate summit and the United Arab Emirates special envoy for climate change Sultan Al Jaber echoed the need to move economics forward while reducing emissions in a way that leaves no one behind, calling the upcoming summit “a COP for All, and a COP of Action” earlier this year.
“This acquisition [of Lekela Power] will give Infinity Power greater scale to deploy practical climate solutions that deliver measurable outcomes, in line with the COP28 objective of being inclusive, transparent, pragmatic and results-oriented,” said Abu Dhabi National Oil Company (ADNOC) CEO Jaber, whose country’s gross domestic product is 30% directly based on hydrocarbons and depends heavily on profits from oil and gas exports for a great majority of its government revenue.
The UAE was the first country in the Middle East and in North Africa to set net zero greenhouse gas emissions by 2050, in line with the 2015 UN Paris Agreement.
“The hard reality is that global emissions must fall 43% by 2030; that’s just seven years away,” said Jaber at the World Government Summit (WGS) in early February, noting that the world needs a major course correction.
Also at the WGS, managing director of the International Finance Corporation Makhtar Diop said that in order to close this major gap, an estimated $9 trillion of investment needs to be made annually to tackle climate action and nearly $1 trillion annually to enforce energy transition in certain countries.
In line with this directive, the owners of Infinity Power and the country of Mauritania signed a memorandum of understanding with German project developer Conjuncta earlier this month for a $34 billion green hydrogen project in the West African country, reported Reuters.
The project will have a production capacity of up to 8 million tons of green hydrogen or other hydrogen-based end products annually using electrolysis, which uses electricity to separate hydrogen from oxygen molecules, with a capacity of up to 10 gigawatts.