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May 9, 2022

These were the biggest power industry operations and technologies deals in the three months to April

The latest acquisitions, mergers, venture financing and asset transactions in the power industry operations and technologies sector

By Data Journalism Team

There were 199 deals recorded involving top power industry operations and technologies companies in the three months to April with a number of high profile partnership, sponsorship, venture financing, equity offering, asset transaction, debt offering, acquisition, and private equity deals.

That’s according to GlobalData’s Financial Deals database, which tracks market activity across a variety of sectors and deal types.

The deals below only include those that have been completed – so excludes rumours or those that have been agreed but not yet executed.

The figures, which cover the top power industry operations and technologies companies, show the market in South Korea to be the most active, with 54 deals taking place over the last three months. That was followed by the US, which saw 37 deals.

Below are some of the largest completed deals to have taken place in the last quarter.

Acquisitions

Macquarie Asset Management and British Columbia Investment to acquire 60% interest in National Grid Gas from National Grid for $5.53bn – 27 March ($5.53bn)

Macquarie Asset Management and British Columbia Investment Management, through their consortium, have reached an agreement to acquire a 60% stake in National Grid Gas, a company that owns and operates the 7,660km gas transmission system in UK from National Grid, an electricity and gas utility company, for a purchase consideration of £4.2bn.

Under the terms, National Grid will receive approximately £2.2bn in cash and will also receive approximately £2bn from additional debt financing at completion.

As part of this transaction, the consortium has also entered into an option agreement with National Grid for the potential acquisition of the remaining 40% stake in the business on broadly similar terms, subject to necessary adjustments.

Goldman Sachs, Barclays, and Robey Warshaw are acting as financial advisors to National Grid in the transaction. The transaction is expected to complete in the second half of calendar year 2022, subject to certain antitrust and regulatory conditions.

Lincoln Webb, executive vice president and global head of infrastructure & renewable resources at British Columbia Investment, said: “This investment aligns well with our diversified portfolio of regulated utilities that securely deliver critical services to customers. We believe National Grid's innovative decarbonisation strategy will ensure the business plays a leadership role in supporting the UK to achieve net-zero carbon emissions on target by 2050, while meeting consumer demand for reliable networks.”

John Pettigrew, chief executive of National Grid, said: “Today's announcement is a strong result for all our stakeholders, including employees and customers. The consortium has a long-term commitment to the UK, with significant experience in owning and operating infrastructure assets. I look forward to our partnership and continuing to deliver safe and reliable gas service at the least cost to consumers. I would also like to thank my colleagues in Gas Transmission and Metering for their hard work that has helped us reach this important milestone.”

CLP Holdings may sell EnergyAustralia – 23 February ($2bn)

CLP Holdings, a power generation company, intends to sell its 100% stake in EnergyAustralia, an integrated energy utility company, for an approximate consideration of $2bn, according to sources citing people familiar with the matter.

CLP is working with a financial adviser on the proposed divestment, sources added.

76KK acquires Mitsubishi Corp.-UBS Realty from Mitsubishi Corporation and UBS Asset Management – 17 March ($1.96bn)

76KK, a Japan-based holding company and a subsidiary of KKR & Co, a US-based private equity firm, has acquired Mitsubishi Corp-UBS Realty, an asset manager established as a joint venture from Mitsubishi Corporation and UBS Asset Management (Americas) Inc, for a cash consideration of ¥230bn ($2bn).

Simpson Thacher & Bartlett and Nagashima Ohno & Tsunematsu served as legal advisers to KKR and Sumitomo Mitsui Banking Corporation served as financial adviser to KKR.

Going forward, the asset manager, which was previously called MC-UBSR, will operate under the name KJR Management, effective immediately.

76KK will also acquire the units in JMF and IIF currently held by Mitsubishi at market price, thereby strengthening the alignment of interest between KKR and the unitholders of JMF and IIF.

UBS Investment Bank acted as exclusive financial advisor to Mitsubishi, UBS-AM, and MC-UBSR. Nishimura & Asahi served as legal advisers to Mitsubishi. Mori Hamada & Matsumoto served as legal advisers to UBS-AM. Anderson Mori & Tomotsune served as legal advisers to MC-UBSR.

Ullico to acquire Hope Gas from Dominion Energy for $690m – 11 February ($690m)

Ullico, a provider of financial and insurance products and services, has entered into a definitive agreement to acquire a 100% interest in Hope Gas Inc (DEWV), a regulated gas distribution company, from Dominion Energy through its infrastructure fund, for a purchase consideration of $690m.

DEWV is serving 111,000 West Virginia customers, with 3,200 miles of gas distribution pipelines and more than 2,000 miles of gathering pipelines.

J.P. Morgan Securities is acting as a financial advisor and McGuireWoods is acting as a legal advisor to Dominion Energy. Mizuho Securities USA is acting as a financial advisor and Milbank is acting as a legal advisor to Ullico in the transaction.

The transaction is expected to be completed in the second half of 2022, subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Act and approval from the Public Service Commission of West Virginia.

Robert M. Blue, president and CEO of Dominion Energy, said: "For nearly 125 years, Dominion Energy West Virginia has provided reliable and affordable natural gas, safely, to the people and businesses of the Mountain State. From its roots as the Flaggy Meadow Gas Company, DEWV has been a pioneer in the natural gas sector, taking part in the construction of one of America's first interstate pipelines, which originated in Wetzel County, and building our country's first extraction plant at Hastings. DEWV is a valuable business with tremendous employees. The business and its people will fit extremely well with Ullico and Hearthstone's commitment to safety and their mission to serve American workers and customers."

Innergex Renewable Energy acquires Aela Energia from Mainstream Renewable Power and Actis for $686m – 3 February ($686m)

Innergex Renewable Energy, a renewable energy developer, has acquired Aela Energia (Aela), a renewable energy company, from Mainstream Renewable Power, a wind and solar power developer, and Actis, an investment company in sustainable infrastructure, for $686m, including the assumption of $386m of existing debt, subject to customary closing adjustments.

Aela is a joint venture between Actis (60%) and Mainstream (40%). Aela's portfolio consists of the Sarco wind farm (170MW), the Aurora wind farm (129MW), and the Cuel wind farm (33MW). Revenues from these facilities are anchored by two forms of power purchase agreements with 25 Chilean distribution companies, maturing at the end of 2036 and 2041.

Credit Suisse and Clifford Chance advised Actis on the transaction.

Venture financing

Enel Secures $652.5m in Venture Funding – 11 April ($653m)

Enel SpA, an energy company, has secured €600 million ($652.5m) in venture funding from European Investment Bank.

The company intends to use the proceeds to support sustainable energy investments in Latin America.

Terra Drone secures $70m in Series B funding – 23 March ($70m)

Terra Drone Corporation, a Japan-based UAV company that provides land survey, inspection, consultation, and UAV development for businesses has secured $70 million in Series B funding from Mitsui Corporation, SBI Investment, Tokyu Land Corporation, Kyushu Electric Power, Seika Corporation, Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development, and Venture Lab Investment.

The company intends to use the proceeds to strengthen current drone based solutions, as well as to accelerate the growth and worldwide adoption of unmanned traffic management and urban air mobility solutions. It will also help the company expand into the US market this year.

Eve Air Mobility to secure $30m in venture funding – 21 March ($30m)

Eve Air Mobility, a US-based developer of air mobility solutions to advance the urban air mobility ecosystem, has agreed to secure $30 million in a funding round from Acciona.

As part of the agreement, Jose Manuel Entrecanales, CEO of Acciona, will join Eve's board of directors as one of its seven members.

Upsy Secures $1.31m in seed funding – 15 March ($1m)

Upsy, a Finland-based SaaS-based software for digital retailers that helps people find the product they need and make a purchase decision, has secured €1.2m ($1.31m) in Seed funding led by Gorilla Capital, followed by Korpun Siemen, Sijoittaja Pro's investor group, a number of private investors, and Business Finland.

Viatec secures Series B funding – 1 February

Viatec Inc, a US-based manufacturer of plug-and-play electronic power take-off systems that support electrification of utility fleets, has secured a Series B funding round, led by Terex Corporation, with participation from Duke Energy. In conjunction with this investment, a Terex representative will fill one of five seats on Viatec's board.

Private equity

AGL Energy rejects takeover bid by Brookfield Global Transition Fund I and GROK Ventures – 20 February ($8.02bn)

AGL Energy, an integrated power generation and energy retailer in Australia, has rejected a takeover bid by Brookfield Global Transition Fund I, an investment fund of Brookfield Renewable, together with its institutional partners and GROK Ventures.

The AGL Energy board considers that the unsolicited proposal materially undervalues the company on a change of control basis and is not in the best interests of AGL Energy shareholders.

On 7 March 2022, AGL Energy received a revised proposal from the consortium to acquire 100% of the shares of AGL Energy at a price of $6.08, which values AGL at an equity value of $4bn.

AGL Energy is looking to split into two companies called Accel and AGL Australia.

On 19 February 2022, AGL Energy received a unsolicited proposal from the consortium to acquire 100% of the shares of AGL Energy at a price of $5.3 per share which values AGL at an equity value of $3.5bn. The transaction values AGL Energy at an enterprise value of approximately $8bn. The proposal is subject to due diligence as well as other conditions. The unsolicited proposal represents: (A) a 4.7% premium to the closing price of AGL Energy of A$5.6 on 18 February 2022; (B) a 4.2% premium to the volume weighted average price (VWAP) since AGL Energy's H122 results announced on 10 February 2022 of A$7.201; (C) a 4.3% premium to the one-month VWAP of A$7.192.

The consortium intends to execute on a plan that will require approximately $14.3bn of capital to facilitate the transition of AGL's generation fleet consistent with the 1.5°C decarbonisation scenario, replacing 7GW of thermal assets through a build-out of at least 8GW of clean energy and storage.

The proposed privatisation is consistent with Brookfield's transition strategy of investing in opportunities where it can generate a meaningful contribution to net zero. The capabilities of Brookfield Renewable will also be critical to ensure a responsible and sustainable transition for AGL, which will see increasingly clean power delivered at competitive prices to AGL's customers.

KKR to acquire Albioma in public tender offer – 27 April ($2.51bn)

An affiliate of the affiliated funds advised by KKR & Co (Kohlberg Kravis Roberts), a US-based private equity firm, has agreed to acquire Albioma, a French producer of solar and biomass power, in a public tender offer. The transaction values Albioma at an enterprise value of €2.35 bn.

The tender offer, which would offer existing shareholders significant and immediate cash value, will be carried out at a price of: (A) €50 per Albioma share (plus the ordinary dividend of €0.84 for fiscal year 2021, which will be paid exclusively in cash) representing a 51.6% premium over the last undisturbed share price on March 2022 and a 46.6% premium over the volume-weighted average price per share over the last three months; (B) €29.1 per Albioma warrant.

The board of directors of Albioma have unanimously welcomed the proposed transaction. In this context, the board of directors has decided to modify the terms of payment of the dividend for the 2021 fiscal year. The dividend, to be proposed to the annual general meeting of 25 May 2022, will remain at €0.84 per share but will be paid entirely in cash, the option for payment in shares having now been withdrawn.

KKR will fund the transaction through its affiliated infrastructure funds. Bpifrance, an Albioma shareholder since 2016 that holds 5% of the group's capital, intends to continue to support Albioma by investing alongside KKR, subject to the approval of its internal governance bodies, the delivery of an informed opinion by its board, and the completion of the offer. The investment by Bpifrance is to be made via the contribution of part of its shares to the offeror at the offer price.

JP Morgan Securities and Darrois Villey Maillot Brochier are acting as exclusive financial advisor and legal advisor to Albioma respectively. Societe Generale and Bredin Prat are acting as exclusive financial advisor/presenting bank of the tender offer and legal advisor to KKR respectively.

The completion of the tender offer will be subject, in addition to the mandatory minimum acceptance condition set out in section 231-9, I 1° of the AMF General Regulation, to a minimum acceptance condition that KKR obtains a number of Albioma shares representing at least 50.01% of the share capital and “theoretical” voting rights. Completion of the transaction also remains subject to EU Commission merger control approval, as well as obtaining foreign investment control clearances in France and in Spain.

Hafslund Eco, Infranode, and HitecVision to acquire 50% stake in Fortum Oslo Varme from Fortum for $1.14bn – 22 March ($1.14bn)

Hafslund Eco, a renewable energy company, Infranode, a long-term infrastructure investor, and HitecVision, a private equity firm, have agreed to acquire a 50% stake in Fortum Oslo Varme, a heating company, from Fortum Corp, for a purchase consideration of NOK10bn in cash.

Fortum Oslo Varme is jointly owned (50/50) by Fortum and the City of Oslo.

As part of the transaction, Fortum will deconsolidate a related NOK2bn loan from the City of Oslo. The consideration is based on a 100% enterprise value of NOK20bn (approximately €2bn). Fortum expects to record a tax-exempt capital gain of approximately NOK5.78bn in the City Solutions segment's results in connection with closing of the transaction.

The transaction is subject to approval by the Oslo City Council (Bystyret), necessary regulatory approvals, and fulfilment of the customary closing conditions. The closing of the transactions is expected during the Q2 of 2022.

POWERGRID Infrastructure Investment to acquire 26% stake in POWERGRID Vizag Transmission from Power Grid Corp – 28 February ($45m)

POWERGRID Infrastructure Investment Trust (PGInvIT), an infrastructure investment trust, has agreed to acquire 26% equity stake in POWERGRID Vizag Transmission, a power transmission and distribution company, from Power Grid Corporation of India Ltd (POWERGRID), a power transmission company, for a maximum purchase consideration of INR3.4bn.

Allumia raises $7.5m in private equity financing – 8 February ($8m)

Allumia, a US-based company engaged in lighting up-gradation for commercial and industrial customers, has raised $7.5 million in series A2 private equity financing. The financing was led by JW Asset Management, with participation from American Electric Power and Duke Investments.

With this investment, Allumia aims to accelerate development of its efficiency-as-a-service technology platform for large-scale deployment of energy efficiency solutions for utilities' mass-market commercial and industrial customers.

Asset transactions

Satluj Jal Vidyut Nigam to invest $6.6bn in solar power projects in Rajasthan, India – 9 February ($6.69bn)

Satluj Jal Vidyut Nigam, a hydroelectric power generation and transmission company, has agreed to invest INR500bn in the construction and development of solar power projects in Rajasthan, India. The combined installed capacity of the projects will be 10,000MW. The investment per megawatt will be $600,000.

The power generated will be transmitted to the beneficiaries through nearest sub-stations. Power purchase agreements for the generated energy will be signed through competitive tariff-based opportunities available in the market.

AXA Investment Managers and Credit Agricole Assurances to acquire 50% stake in Hornsea 2 wind project from Orsted for $3.95bn – 28 March ($3.95bn)

AXA Investment Managers, an investment management firm, along with Credit Agricole Assurances (CAA), an insurance services provider, have agreed to acquire a 50% stake in the Hornsea 2 wind project in the UK, from Orsted A/S, an electric utility services provider, for a purchase consideration of £3bn. The total installed capacity of the project is 1.3GW. The transaction will imply a deal value of approximately $6.1 million per megawatt.

NKT has commissioned the 220kV HVAC power cable system for the 1.32GW Hornsea 2 offshore wind farm on 26 April 2022.

Hornsea 2 is currently under construction and the offshore wind farm is expected to be commissioned later in 2022. AXA IM Alts and Credit Agricole Assurances will then each own 25% of the project. The investors' 50% stake in Hornsea 2 will be funded through a combination of equity and a senior multi-tranche staple financing package provided by 30 banks and including a covered tranche guaranteed by EKF, Denmark's export credit agency. The financing package was originated and structured by Orsted.

Hornsea 2 is located 90km (56 miles) off the Yorkshire coast in the North Sea and is providing power to more than 1.3 million homes. Orsted is finalising the construction of the project and will provide long-term operations and maintenance (O&M) services for 20 years from its O&M base at the Port of Grimsby. Orsted will provide the incoming partners with balancing services and a long-term route to market for the renewable electricity generated from Hornsea 2.

The transaction is subject to full commissioning of the Hornsea 2 project and certain regulatory approvals, including from relevant competition authorities, and is expected to close in the second half of 2022.

Energy Infrastructure Partners completes acquisition of 30% stake in renewable portfolio in France from Boralex for $602.5m – 24 February ($603m)

Energy Infrastructure Partners (EIP), an investment company in sustainable energy infrastructure, through its managed funds, has completed the acquisition of a 30% stake in renewable assets and development pipeline in France, from Boralex, a renewable energy company, for an purchase consideration of €532m. The total installed capacity of the renewable portfolio is 1GW. This transaction implies a deal value of $2 per megawatt.

Boralex remains the majority shareholder and manager of its assets in France and intends to use a portion of the cash proceeds into its operations in France.

Boralex is entering into a long-term partnership with EIP, which includes 1.1GW of French assets in operation as well as a 1.5GW portfolio of projects in the French market. This transaction will result in a pre-money equity valuation of €1.71bn for all Boralex operations in France.

Scatec Completes project financing of $334.5m for refinancing of six solar power plants in Egypt – 28 April ($334m)

Scatec, a renewable energy company, has completed non-recourse project financing of $334.5m for refinancing of six solar power plants in Egypt. The combined installed capacity of the solar projects is 380MW.

The refinancing was provided by a consortium of development finance institutions, comprising the European Bank for Reconstruction and Development (EBRD), the US International Development Finance Corporation, the Dutch entrepreneurial development bank FMO, and German Investment Corporation DEG, alongside private institutional investors from around the globe, through the issuance of a 19-year non-recourse Green Project Bond.

The refinance is being granted for six operational solar power plants in the Benban Solar Park with total capacity of 1,465MW, initiated as part of the Egyptian Government's ambitious Sustainable Energy Strategy for the period ending 2035.

Multilateral Investment Guarantee Agency, a part of the World Bank Group, and EBRD risk mitigation instruments were incorporated into the structure to facilitate distribution to the private sector investors, including major institutions for whom these are first-ever investments in Egypt.

The refinancing will provide increased leverage, extended tenor, and reduced interest costs that will improve Scatec's and its project partner's future cash distributions from the power plants.

Mitsubishi UFJ Financial Group acted as arranger for the bond issue.

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