Equity Value
Investment in Fortune Hydro is one of the most effective means by which an investor can put their money to work to fight climate change while earning a financial return. Hydropower plants are known to generate CO2-neutral energy for up to a century, and beyond. Such a lasting renewable energy legacy is possible to achieve with small hydropower.
Investment Process
Strategic Planning
And Deal Preparation
Activities performed under this phase are:
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Site visit
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Project development to investment grade
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Investment preparation
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Preparation of exclusivity agreement
Project Approval
Activities performed under this phase are:
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Preliminary investment decision
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Detailed planning
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Detailed due diligence
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Finance roadshow
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Investment commitment
Business Case Review
The business case is reviewed to find whether it meets the investment criteria. An identifiable off-taker funding plan is also developed with the inclusion of local partners.
Investment Approval
The new company acquires the project, builds & operates the assets, and secures off-take contracts.
Acquisition and Funding
The company rolls out the investment, commits funds, and completes the construction.
Business Unit Proportion
Our projects are supported and delivered in cooperation with selected partners and suppliers.
Investment Criteria
Project Size
At Least 10 MW
Total size of the project
Local Partners Ownership
15% Equity
Local partners must own at least 15% equity in the business
Report
Favorable
Achieve favorable hydrology and technical 3rd party reports
Fortune Hydro’s Ownership
51% TO 85%
51% to 85% of the ownership with Fortune Hydro allowing majority control of the power plant
IRR
IRR >10%; RoE > 15%
Business case with IRR of >10% (ready to build)
Sources of Shareholders &
Investors’ Payout
Cash-rich and asset-heavy investments provide a stable source of liquidity for debt service and dividend payments. Additionally, payments to investors will be secured through the following sources:
Net Profit
Net profit margin generated from the operating entities. Free cash flow
80% avg EBITDA margin
Long-Term
Debt
Pay portion of equity with
long-term debt
Refinancing
Of Equity
Funds generated from refinancing of equity through long-term debt or transfer to debt fund after 1 to 2 years of successful operations.
Sale And
Lease Back
Funds generated from the sale and lease back of operating assets
€1 BILLION
Fortune Hydro plans to raise investment funds during the initial growth phase from the investors over a period of 5 years. The funds raised will be used for engineering, development, and overall operations of the projects under the portfolio. The average investment per asset will range from €25 to €100 million with a project lifecycle of over 25 years, minimum.
15%
Target return (ROE) to be achieved by the company for the investors (including annuities). Minimum ROI to be achieved is 10%.
SME-X, LSE-SPAC
Generating secondary market for tradable shares, convertible bonds and notes.
Tier One Auditors
(Fortune Hydro's auditors)