Allen & Overy for the first time brings together crowdfunding, venture capitalists and institutional investors in one financing structure

Allen & Overy has advised Munich-based solar energy company REDAVIA on its innovative financing structure.  The contractual structure, which has been used very rarely in the market so far, enables the company to finance, jointly with crowdfunders, venture capitalists and institutional investors, solar plants according to project-specific requirements, initially in three African states.  New financing parties can be flexibly integrated, if necessary. Through a multi-level platform, REDAVIA offers investors the possibility to become involved in projects in which environmental, social and corporate governance (ESG) criteria are applied.  In this context, the investors can choose between different finance instruments.

In this way, it has been possible to secure the financing of a solar project in Ghana via an international crowdfunding platform (TRINE) within a few days.  The most recently completed financing transaction relates to the acquisition of solar modules which are leased to local medium-sized businesses, initially in Tanzania, Kenya and Ghana and, in the longer term, other African countries, to make a contribution to the local power supply respecting ESG criteria.  The ESG criteria are in particular based on the relevant conventions of the United Nations and the World Bank as well as the ILO Declaration on Fundamental Principles and Rights at Work, the UN Guiding Principles on Business and Human Rights adopted by the UN Human Rights Council and the environmental regulations of the International Finance Corporation.

The contractual structure is secured by a Luxembourg security package as well as local security in the relevant project countries, with the respective security agreements having been concluded in close cooperation with local law firms in Tanzania, Kenya and Ghana.

REDAVIA GmbH is a Munich-based solar energy company with local teams and operating companies in West and East Africa. Under a REDAVIA full-service leasing arrangement, small and medium-sized businesses as well as international corporations are provided with cost-effective, reliable and clean energy for their local activities and can use solar energy as key technology for an environmentally sustainable development.

The Allen & Overy team was led by partner Wolfgang Melzer and included associate Tom Haeseler; partner John Coburn and associate Enda Jordan advised on English law issues (all Banking & Finance, Frankfurt). In addition, partner Henri Wagner and associates Alexandre Champion and Markos Tochovitis (all Banking & Finance/ICM, Luxembourg) advised on aspects of Luxembourg law.

At REDAVIA, the project was led in-house by CFO Dr Oliver Keilhack.

In addition, the following relationship law firms advised on Ghanaian, Tanzanian and Kenyan law issues: AB & David Africa (Ghana), REX Attorneys (Tanzania) and Munyaka Advocates LLP in cooperation with Rödl & Partner (Kenya).