The HMC Capital Ltd (ASX: HMC) share price is down 15% after the fund manager gave an update about its energy transition portfolio.
HMC Capital is a diversified alternative asset manager focused on real estate, private equity, the energy transition, digital infrastructure and private credit.
Energy update
HMC Capital announced a number of elements related to its energy transition strategy. Let’s take a quick look at each of those elements.
Acquisition update
Firstly, the acquisition settlement of Neoen Australia’s Victorian assets acquisition has been deferred by one month to 1 August 2025. This acquisition was originally announced in December 2024.
Funding update
HMC Capital announced to the ASX that a $200 million non-recourse mezzanine financing facility secured against the Neoen VIC Portfolio, underwritten and provided by two global banks.
The ASX share agreed to acquire the Neoen Victoria portfolio for $950 million, through two instalment payments of $750 million at financial close and a final instalment of $200 million at 29 December 2025.
Senior debt financiers agreed to underwrite around $550 million of the acquisition price at the time of the announcement.
The ASX share will invest $50 million of equity at financial close.
Wind farm fire
On 28 May, a fire incident impacted one of the 56 wind turbines at the Bulgana Wind Farm which has resulted in a detailed operational and safety review.
After that review, 49 of 56 turbines are operating with all except the fire-impacted turbine expected to be operational in the coming weeks.
Intention to merge platforms and value optimisation
The business announced an intention to merge the Neoen Victoria portfolio and Stor Energy battery platforms to create a combined operating platform.
It also said it’s currently evaluating a range of options about its energy transition portfolio. It’s looking at fund raising, a partnership/merger with a major investor looking to build a platform to optimise value over the long-term from energy market volatility, and it will benchmark all options against potential portfolio rationalisation or sale alternatives.
The company is aiming to ensure it delivers sustainable long-term returns.
New energy transition CEO
HMC Capital also noted that Angela Karl has stepped down from her position as Managing Director and head of the energy transition at HMC Capital.
The new CEO is Gerard Dover.
Final thoughts on the HMC Capital share price
Clearly, this wasn’t what investors wanted to see. The economic picture has changed significantly for energy transition assets since 2024.
I’m not sure if it’s a good buy today – it depends on the direction of the funds under management (FUM). In two years’ time it could appear cheap today, so time will tell.
