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Surge in renewable energy IPOs

Wind and solar companies are tapping the stock market for cash at the fastest pace in two years, led by three initial public offerings in London luring investors with dividends that beat returns on government bonds, The Age has reported.

Clean-energy companies raised $3.8bn (£2.5bn) in IPOs in the second quarter, double the pace of the first three months of the year, according to data compiled by Bloomberg.

The Renewables Infrastructure Group raised $460m (£300m) and began trading July 29.

Its intention, to pay a 6 per cent yield, compares with a 2.31 per cent yield on the U.K. government’s 10-year gilt.

The offering was the biggest of three London IPOs this year by renewable companies taking advantage of investors’ thirst for income as the Bank of England keeps interest rates at record lows.

Surging share prices have revived stocks as a source of funds, allowing companies that traditionally rely on banks and private equity to tap deeper pools of capital at lower costs.

A rebound in the stock market is encouraging the IPOs. The NYSE Bloomberg Solar Index of 102 companies has appreciated 65 per cent since the beginning of December.


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