13 January 2021
Templars advised Starsight Energy, a leading commercial & industrial solar power and energy efficiency company, on three separate but related transactions all targeted at scaling operations, increasing their capital base and improving market share within West Africa.
First: A =N=3.62 Billion (c. $9.2 Million) senior debt facility from the Chapel Hill Denham Nigeria Infrastructure Debt Fund (NIDF), one of the largest infrastructure funds in Nigeria. This 10-year Naira facility will give Starsight stable funding to enable it to rapidly grow its provision of climate-friendly solar-hybrid energy solutions for Commercial & Industrial customers across Nigeria with minimal foreign exchange risk. According to ESI Africa, the transaction is the first time a solar power-based energy company in Nigeria has been successfully backed by long-term Naira financing.
Second: Closing shortly after the Naira funding is a $10 million debt funding provided by Finnfund (a Finnish development financial institution targeting private companies in developing countries) and Norfund (the Norwegian government owned investment fund for developing countries). The facility is an upsizing of an initial $10 million debt provided by the same institutions in 2019 and is intended to support Starsight’s expansion outside Nigeria and to generally improve energy reliability, cost savings and environmental benefits for Starsight’s customers.
Third: Expansion of the Starsight’s operations into other key African markets leveraging on the now effective African Continental Free Trade Area Agreement (AfCFTA). This initial phase involved Templars advising Starsight on its entry strategy into Ghana, the implementation and operationalisation of its business model in that market and the negotiation of commercial contracts with different offtakers. The transaction signals the commencement of the expansion of clean energy projects by Starsight into different African markets.
The Templars team which advised on the documentation, negotiation, structuring, regulatory compliance, legal risks analysis and coordination of each of these transactions was led by Finance, Energy and Projects partner, Desmond Ogba and Corporate and Commercial Partner, Ijeoma Uju (advising on regulatory, market entry and cross-border trading issues). They were supported by Senior Associate, Adenike Oyeledun and Associates, Ijeamaka Nzekwe, Ojuolape Kalesanwo, Michelle Eigbobo and Ife Adaralegbe.