Linklaters advises on the NeuConnect 1.4GW subsea interconnector between England and Germany

Linklaters has advised the Sponsor team comprising of Meridiam, Allianz Capital Partners and Kansai Electric Power on the financing of the NeuConnect interconnector project, a 1.4GW subsea high-voltage direct current (HVDC) electricity interconnector that will link the Isle of Grain in England to Wilhelmshaven in Germany.

The NeuConnect interconnector project comprises 725km-long ground and subsea cables running through British, Dutch and German waters. It will mainly consist of two converter stations, one located at each end of a HVDC cable.

The £2.4 billion (€2.8 billion) NeuConnect interconnector project involved a successful raising of long-term non-recourse project financing. The project is backed by a very strong business and risk profile, with highly capable Sponsors who bring to the table long-standing experience in the power and infrastructure sectors. Once constructed, the project will help to improve security of supply between the UK and Germany, benefitting the end-consumers. By supporting renewable generation through the transfer of excess renewable capacity, NeuConnect will look to facilitate the avoidance of 13Mt of CO2 over 25 years of operations.

Notable Lenders included the Japan Bank for International Cooperation, the European Investment Bank and the UK Infrastructure Bank. The consortium of Lenders involved highly reputable commercial banks as well as institutional investors. 

The Linklaters’ core team was by led by Subir Rajadhyaksha and Charlotte L Morgan, and included Nicholas Howarth, Trisha Dasgupta and Imogen Ormerod.

Sergio Rodriguez Casado, Partner, Executive Director Iberia & Head of Global Funding at Meridiam commented:

“After several years of great efforts and endless perseverance, Neuconnect has achieved a crucial milestone to start paving the way to the first ever UK-Germany energy link, Neuconnect will provide great benefits to both countries and their people and will contribute to ecological transition by significantly reducing CO2 emissions. This green financing is the first step to see such an amazing vital energy link in operation in 2028 and we need to thank everyone who made it possible.”

Charlotte Morgan commented: 

“The European Union and the UK are working to tackle Europe’s energy and climate challenges by developing an energy market that is competitive, integrated and fluid, with interconnectors having a key role to play. We are proud to have supported NeuConnect on such a landmark development that will ensure affordable and secure energy supply to many households and businesses, and we look forward to watching the project as it progresses.”

Subir Rajadhyaksha said:

“It was a privilege to work with the Sponsors to help secure the financing for this Project. The financing of an asset as complex as NeuConnect brought with it its own unique challenges. One of the first few interconnectors to be project financed, it launched with remarkable success indicating a strong appetite for such projects in the bank market. We are very pleased to have been part of this landmark deal and look forward to seeing it develop.”

The wider integrated cross border Linklaters team comprised of Arun Kapoor, Ali Zu’bi, Matt Carpenter, Archie Prew and Clarissa Wei (Energy & Infrastructure, London), Eduardo Barrachina and Durlav Nayak (Capital Markets, London) and Philippa Gavey (Corporate, London), Przemyslaw Lipin and Matthias Hohmann (Banking, Frankfurt), Thomas Schulz and Josepha Mallwitz (Corporate, Berlin), Bob Meijer and Akrit Anand (Banking, Amsterdam), Marleen Wessel, Ruth van der Haar and Emma Romijn (Corporate, Amsterdam), Christoph Barth and Sebastian Plötz (both AFIG, Düsseldorf).

Linklaters' global Energy & Infrastructure team is known for its strength in advising on complex, large scale transactions, with combined financing and energy regulation capability and expertise in the regulated energy sector, providing a seamless, one stop shop for clients. Earlier this year the team advised on the €500m financing of the Greenlink Interconnector between Ireland and Great Britain. Linklaters has now advised Sponsors on the two of the most recent Interconnectors to secure financing for construction.