BP has agreed to acquire the remaining majority interest in Lightsource BP, the solar and battery storage developer it bought into in 2017.
BP (LON:BP) announced on Thursday it would buy the 50.03% interest it does not already own, taking equity currently held by the company’s founders, management and staff in a deal worth around £254 million.
The energy giant said both companies had agreed “now is the right time” for the transaction, as it looks to support Lightsource BP’s “continued growth and high performance.”
The selling shareholders will also have the opportunity to receive further payment over time, dependent on company performance and the market value of pre-agreed assets divested from the portfolio.
For full year 2022, Lightsource BP reported underlying EBITDA of £287 million and had a corporate level debt adjusted for cash of £1.5 billion, excluding project finance.
The supermajor says it intends to continued to deliver “double digit equity returns” from the business.
In addition, it intends to use the developer’s experience in utility-scale onshore renewables to help meet BP’s wider demand for low carbon power – something it said would help underpin and de-risk delivery of targets for other transition arms in hydrogen, EV charging and biofuels as well as power trading.
The company has said it intends pursue greater “integration” with its other business arms amid a focus on creating value chains for ‘green electrons’.
Subject to regulatory approvals, the transaction is currently anticipated to close in mid-2024.
BP acquired 43% of solar developer Lightsource in 2017, subsequently rebranding the firm as Lightsource BP. That stake was expanded to the near 50/50 split in 2019.
Since that time the company has expanded operations from three countries to 19, built a 61GW development pipeline, and grown to over 1,200 staff.
Last year the venture also made moves to become one of Australia’s largest solar owner-operators.
Following completion of the deal BP said it will maintain Lightsource BP’s independent brand and organisation.
In early 2024, BP senior VP of finance for gas and low carbon energy, Joaquin Oliveira, will be seconded to take up the role of Co-CEO of the venture. Mr Oliveira has already been a non-executive director of the company for more than two years.
Anja-Isabel Dotzenrath, BP EVP for gas and low-carbon energy, said: “This is a natural evolution of the partnership we have built over the past six years now we will be able to take Lightsource BP to the next level of profitable growth and performance.
“We will continue to scale this successful business, and also apply its capabilities and expertise to help meet BP’s growing demand for low carbon power from our transition growth engines. I look forward to welcoming the Lightsource BP team to BP and am confident that together we can further strengthen its position as a leading global renewables developer.”