Drax Group's (LSE:DRX) recommended £548 million offer for Bluefield Solar Income Fund carries a significance that extends well beyond the deal itself, providing the clearest external validation yet of where UK solar assets should be valued in a sector that has spent two years trading at persistent discounts to net asset value.
Jefferies argues the transaction effectively puts a floor under Foresight Solar Fund's carrying valuation for its UK portfolio, the most direct read-across from the deal terms.
The arithmetic is instructive. Stripping out Bluefield's wind assets and development projects to isolate the core operational solar portfolio, the Drax offer of 92.574p per share implies a valuation of £0.98 million per megawatt of capacity.
That sits almost exactly in line with Foresight Solar's own stated valuation of £0.97 million per megawatt as at 31 December 2025, a figure that remained unchanged as at 31 March 2026.
Bluefield's own stated net asset value per megawatt of £1.07 million was slightly higher, reflecting a more conservative discount rate of 8.5% applied to unlevered UK assets, compared with Foresight Solar's 8%, meaning the gap between the two funds' valuations was already narrower in Foresight Solar's favour on a discount-rate-adjusted basis.
On an enterprise value to EBITDA basis, the deal implies a multiple of 7.3 times for Bluefield against 6.5 times for Foresight Solar's UK portfolio, with the premium in Bluefield's case reflecting the revenue synergies Drax expects to realise as a strategic acquirer rather than any fundamental valuation difference.
The broader implication for the sector is that an arm's length transaction, recommended unanimously by Bluefield's board and expected to complete in the third quarter of 2026, has now established a credible reference point against which peers' net asset values can be assessed.
Jefferies also flags that Drax retains firepower for further acquisitions, with approximately £500 million potentially available for additional renewables deals after allocating up to £1 billion towards batteries and flexible generation assets.
Other parties involved in Bluefield's formal sales process may now turn their attention to the remaining listed solar funds, with NextEnergy Solar Fund the most obvious name in the frame.