Switched On (Wind Assets) Limited
Formed in 2015, Switched On (Wind Assets) Limited is an established privately-owned wind turbine operator that currently owns three turbines in Devon, Cambridgeshire and Merthyr Tydfil with a combined capacity of 1.25 MW. All three of the company’s existing turbines benefit from feed-in-tariff subsidies and will do so for the full term of the bonds.
In 2020, the company generated 2,415 MWh of electricity, enough to power the equivalent of around 650 homes.
The bond offer
Switched On (Wind Assets) is raising £1 million through this offer to expand its portfolio of turbines via the installation of a refurbished turbine, adjacent to its existing 750kW turbine in Merthyr Tydfil, mid-Glamorgan in Wales. This fourth turbine is forecast to contribute 35% of the company’s income over the bond term.
Unlike the existing turbines, the new turbine will be subsidy free and hence 100% reliant on the sale or export to the grid of the electricity it generates. Switched On (Wind Assets) benefits from power purchase agreements for all of its turbines, including with a large international meat producer (Kepak Group Ltd) for the new turbine across the full term of the bonds. Kepak’s energy requirements at its Merthyr Tydfil site are expected to comfortably exceed the new turbine’s generation levels.
Once the new turbine is operational, Switched On (Wind Assets) Limited is forecast to generate 4,000 MWh of clean, green electricity each year - enough to power the equivalent of almost 1,100 homes.
IFISA eligible
Switched On (Wind Assets) Limited bonds are eligible to be held in a Triodos Innovative Finance ISA (IFISA). The IFISA is a type of ISA that allows you to hold crowdfunded debt securities such as this bond. As with all ISAs, there are eligibility criteria and you receive interest tax-free. ISA eligibility does not guarantee returns or protect consumers from losing their money.
To invest in Switched On (Wind Assets) Limited’s bonds through a Triodos IFISA, select the ‘Invest through IFISA’ option. This selection will add to your current year IFISA or will open a new IFISA if you haven’t previously opened one.
Transferring an existing ISA
If you want to invest by transferring an existing ISA to a Triodos IFISA you must first request the transfer. You can do this under ‘Account’ once you’ve become a registered user of the platform. Your ISA transfer must be completed first, before you make an application for bonds.
Key terms
Issuer
Switched
On (Wind Assets) Limited
Term
10
years, repayable in nine equal annual instalments with the first repayment on
31 August 2023 and the final repayment on 31 August 2031.
Interest
5.25% gross per year, increasing in line with
the annual retail price index each year from September 2022. Payable in arrears on 31 August each year (paid net of UK basic rate tax unless held in an IFISA) with the
first payment on 31 August 2022. Payment of interest and repayment of capital are not guaranteed.
Early repayment
Switched
On (Wind Assets) Limited has the right to repay the bond in part or in
full from 31 August 2024.
Security
The bonds are secured by way of a first ranking
charge over all the assets of the company but this asset security does not mean
that capital or interest payments are guaranteed in any way. An independent
security trustee will be appointed to represent the bondholders’ security
interests.
Transferability
Bonds are transferable but are not listed on any
investment exchange which means that bondholders will have to find a willing
buyer and agree a purchase price with them, which in practice may not be easy. Investors should be prepared to hold the bonds for their full 10-year term.
Covenant
A negative pledge regarding other borrowings
until the bonds are repaid in full. This prevents Switched On (Wind Assets) Limited from taking on any additional debt in that time. Whilst the bonds remain
outstanding, repayment of any director’s loans, payment of dividends to any
shareholder or payments to related parties are
only permitted subject to the retention of a minimum cash balance of £165,000.
Minimum raise
£1,000,000. If less than £1,000,000 is raised,
monies will be returned to investors with no accrued interest.
Timetable
Closes on 3 September 2021, unless fully
subscribed earlier or offer is extended. Bonds are allotted 15 days after close
and investors start to accrue interest from that date.
Capital at risk warning
Past performance is not an indication of future performance. Capital is at risk and returns are not guaranteed. Investors should read the offer document in full, including the risks section, before deciding whether to invest.