- H1 Holdings and Revego Fund Managers have announced plans to explore a strategic merger that would create a renewable energy investment platform with approximately R13.3bn in assets under management.
- The proposed transaction would combine H1 Holdings’ renewable energy portfolio spanning 26 projects with Revego’s institutional investment platform backed by the Revego Africa Energy Fund.
- The announcement comes as questions continue to surround the use of public and international development finance that supported H1 Holdings’ growth, particularly regarding empowerment outcomes and the concentration of economic benefits.
H1 Holdings and Revego Fund Managers have announced their intention to explore a strategic merger aimed at creating one of South Africa’s largest dedicated renewable energy equity investment platforms, with a combined asset base of approximately R13.3bn (US$805m).
The proposed transaction would combine H1 Holdings’ interests in a diversified portfolio of predominantly operational renewable energy assets with Revego’s established institutional investment platform. The merged entity would provide investors with access to a diversified, open ended renewable energy investment vehicle positioned for further capital raising and expansion.
H1 Holdings’ portfolio spans 26 projects across wind, solar, battery energy storage and hydropower assets. Revego contributes its regulated fund management platform through the Investec backed Revego Africa Energy Fund, which has built a track record of attracting institutional infrastructure capital and delivering cash distributions to investors.
The merger announcement arrives against a backdrop of increasing scrutiny over the role of H1 Holdings within South Africa’s renewable energy sector and the extent to which public and development finance institutions have supported the company’s growth under black economic empowerment (BBBEE) funding programmes.
The Development Bank of Southern Africa (DBSA) provided approximately R326m in BBBEE equity funding to facilitate H1 Holdings’ participation in Scatec’s Round 4 Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) projects. The DBSA also financed H1 affiliated projects including the Roggeveld Wind Project with approximately R951m and the Copperton Wind Project with around R1.2bn.
Questions remain regarding whether the DBSA adequately monitored compliance with funding conditions linked to employee ownership structures. Industry stakeholders have raised concerns that dividends generated from DBSA funded BBBEE equity facilities may have ultimately benefited a limited group of beneficiaries rather than delivering the broad based participation envisaged under South Africa’s empowerment framework.
International development finance institutions also played a significant role in supporting H1 Holdings. Norfund and CDC Group, now British International Investment, jointly invested R600m in H1 Capital as part of efforts to advance black ownership and participation within South Africa’s energy sector.
Related news: The BBBEE cat that has all the renewable energy cream in South Africa
The Industrial Development Corporation (IDC) has also faced growing scrutiny over its funding relationship with H1 Holdings. The IDC confirmed that it provided a R690m BEE mezzanine loan facility, together with R900m in senior project debt, to support H1 Holdings’ 49% equity stake in Scatec’s Kenhardt solar and battery storage projects.
While the IDC notes that the mezzanine facility was fully repaid following a refinancing transaction led by Standard Bank in September 2025, critics continue to question the developmental impact of the funding structure.
Related news: Standard Bank provides R1.921billion equity funding facility to H1 Holdings
Market participants frequently characterise H1 Holdings as an investment vehicle whose primary role is facilitating compliance with local ownership requirements for international independent power producers rather than contributing operational, engineering or construction expertise to projects.
The debate has intensified following the IDC’s assertion that H1 Holdings was not presented as a broad based empowerment entity and that such a structure was not required under the Risk Mitigation Independent Power Producer Procurement Programme. This position raises questions about the use of development finance under empowerment funding mechanisms where broad based economic participation is not a primary outcome.
H1 Holdings was controversially was named as BBBEE partner in 21 of the 25 preferred bidder projects in Bid Window 5 of the REIPPPP. Only 11 of these projects subsequently reached financial close. H1 Holdings and several international project partners remain engaged in a legal dispute with the IPP Office concerning bid bond payments linked to unsuccessful projects. Read more
Additional concerns relate to the concentration of economic benefits within renewable energy ownership structures, as well as broader questions around local content compliance, labour participation and developmental outcomes associated with publicly supported projects. Read more
Despite the criticism, the IDC maintains that all funding approvals were subject to rigorous due diligence processes, including beneficial ownership verification and governance assessments. However, calls for greater transparency regarding value distribution, empowerment outcomes and developmental impact continue to grow.
The matter has attracted increasing attention from business organisations and policymakers. The National African Federated Chamber of Commerce and Industry has publicly questioned aspects of the IDC’s funding decisions, while Parliament has initiated a formal enquiry into the corporation’s lending practices.
Against this backdrop, the proposed merger represents a significant consolidation move within South Africa’s renewable energy investment sector.
“South Africa’s renewable energy sector is entering a new phase of maturity, marked by a growing base of operational assets and increasing participation from institutional investors,” said Ziyaad Sarang, Chief Investment Officer at Revego.
“As early investors begin to exit mature portfolios, demand is rising for scaled, well governed platforms capable of acquiring and managing these assets over the long term. The proposed merger is designed to directly address this opportunity by creating a platform with the scale, structure and capital access required to support secondary market activity while helping institutionalise ownership of operating renewable energy assets.”
Reyburn Hendricks, Chief Executive Officer of H1 Holdings, said the transaction would strengthen long term ownership structures within the renewable energy sector while allowing H1 to continue focusing on project origination, development, acquisition and optimisation.
Andre Wepener, Head of Structured Finance Solutions at Investec Corporate and Investment Banking, said the combined platform would provide pension funds and institutional investors with greater access to operating renewable energy infrastructure through a scaled domestic investment vehicle.
The proposed transaction remains subject to regulatory, lender and stakeholder approvals.
Author: Bryan Groenendaal
