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Masdar ‘on the lookout’ for deals in China, says CFO

By Eva Levesque
A floating solar plant in Brazil – 10,500 panels sit on the surface of the Billings reservoir in Sao Paulo. Masdar is on the hunt for solar and wind projects Reuters/Jorge Silva
A floating solar plant in Brazil – 10,500 panels sit on the surface of the Billings reservoir in Sao Paulo. Masdar is on the hunt for solar and wind projects
  • Interview with Mazin Khan
  • ‘Macroeconomic conditions’ open door
  • Focus on solar and wind projects

Masdar, Abu Dhabi’s state-owned clean energy company, is looking to acquire assets in China as part of its strategy to expand its portfolio of renewable energy projects.

Mazin Khan, its chief financial officer, told AGBI that “macroeconomic conditions, with high interest rates and renewable players looking for capital” were opening the door for mergers and acquisitions in China. 

“We’re definitely taking this as an opportunity to be on the lookout for deals,” Khan said. Masdar is particularly interested in onshore and offshore wind and solar technologies.

Mazin Khan, CFO of MasdarMasdar
Offshore wind farm in the North SeaNTB/Ole Berg-Rusten via Reuters
Mazin Khan, Masdar’s CFO, says renewables players are ‘looking for capital’

After years of subsidies, China’s solar industry is undergoing a wave of company failures and consolidation. Excessive capacity has pushed prices below costs.

However, analysts estimate that Beijing will still need $450-570 billion of green investment a year to meet its target of carbon neutrality by 2060. 

Khan said Masdar, which wants to increase its portfolio to 100GW of clean energy projects by 2030, sees M&A playing a significant role in its growth.

The company has accelerated its expansion in the past 24 months. It now has projects in 40 countries across Asia and Africa and has made several large acquisitions in Europe and the US.

The renewables giant, which is jointly owned by Adnoc, the Abu Dhabi National Energy Company (known as Taqa) and sovereign wealth fund Mubadala, currently has 22GW of gross capacity across 83 projects. 

On Tuesday, it completed a secondary listing of its $1 billion dual-tranche green bond on the Abu Dhabi Securities Exchange.

The bonds, first issued in July, attracted significant interest from international and regional investors. They were oversubscribed 4.6 times.

The securities are part of a larger programme to raise up to $3 billion to fund projects. Masdar has raised $1.75 billion so far.

Khan said the next issuance of green bonds would be in 2025 and the company plans to tap the green debt market annually.

Over the next 12 months, the proceeds from the latest issuance will be used to invest in greenfield projects, mainly in Uzbekistan, Azerbaijan and the Middle East – especially in the UAE. 

“We have a couple of projects in the pipeline already, mostly in solar,” he said.

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“We like to market our bonds as 'dark green bonds', which basically means that every single dollar an investor is putting in us is going to the development of a brand new project, with an impact in terms of carbon emissions.”

Financing renewable projects in developing countries presents risks that might put off some investors. “It is not an easy task,” Khan said.

“By using Masdar’s green bond vehicle, investors are not taking the credit risk they would take in order to invest money directly in those places,” he said. “They're taking the credit risk of Masdar, which is AA-.”

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