Spanish firm Abengoa is to invest $2.5bn in a newly formed entity with EIG Global Energy Partners, which will handle more than $9.2bn of renewable energy project acquisitions.

The new entity named Abengoa Projects Warehouse 1 (APW1) will be set-up within the next four to six weeks. EIG will be the majority stakeholder for the new venture with 55% interest, while Abengoa will own the rest of the equity.

"APW1 will acquire renewable and conventional power generation, power transmission and water management assets."

APW1 will acquire renewable and conventional power generation, power transmission and water management assets, which are presently being constructed by Abengoa in the US, Mexico, Brazil and Chile.

The new entity will sign the existing right-of-first-offer (ROFO) agreement between Abengoa and Abengoa Yield. It will also sign another ROFO in order to make investments for new projects to be acquired by Abengoa.

A total of 100% of initial equity will be reinvested by the firm for a second set of projects.

APW1 intends to extend its activity for the next eight years and add another $6bn to $7bn of value to its initial worth of $9.2bn. Abengoa has been working in co-ordination with the US-based EIG since 2007.

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EIG, which is a specialist investor in energy and energy-related infrastructure, has also been a co-investor for Abengoa for an ethanol plant in France.