National Grid (LON:NG) has moved to expand into US renewable generation, having agreed to pay $100 million for Minnesota-based Geronimo Energy, the London-listed group has said. The company is further looking to acquire a stake in solar and wind generation projects developed by Geronimo.
National Grid’s share price surged in the previous session, gaining 2.46 percent to close at 867.10p. The stock outperformed the broader UK market, with the benchmark FTSE 100 index giving up 38.45 points to end trading 0.53 percent lower at 7,157.55. The group’s shares have added more than 11 percent to their value over the past year, as compared with a flat Footsie.
NG expands into US renewables
National Grid announced in a statement yesterday that it had entered into an agreement to acquire Geronimo Energy, a clean energy developer based in Minneapolis. The London-listed utility will pay $100 million, with potential further payments subject to successful development of the project pipeline. The blue-chip group is further progressing an agreement to acquire a 51-percent share in 378MW of solar and wind generation projects developed by Geronimo for $125 million.
The projects, which have long-term power purchase agreements in place, will be jointly owned by National Grid and Washington State Investment Board and operated by the FTSE 100 group. Both transactions are subject to various approvals and are expected to close in the second quarter of the year.
Analysts on London-listed utility
The 15 analysts offering 12-month price targets for National Grid for the Financial Times have a median target of 930.00p on the shares, with a high estimate of 1,030.00p and a low estimate of 800.00p. As of March 2, the consensus forecast amongst 18 polled investment analysts covering the blue-chip group has it that the company will outperform the market.