EQT Infrastructure and Fortistar to sell MCV
*EQT Infrastructure and Fortistar have agreed to sell MCV to Borealis
*During EQT Infrastructure’s and Fortistar’s ownership , MCV has increased
the plant’s capacity, operating efficiency and reliability through a broad
range of operational improvement initiatives and improvements to key
*MCV sales and EBITDA have increased by 27% and 49% respectively from 2009
WHITE PLAINS, N.Y. -- October 02, 2012
EQT Infrastructure and Fortistar have signed a definitive agreement to sell
Midland Cogeneration Venture (“MCV”) to Toronto-based Borealis Infrastructure
(“Borealis”). Borealis invests in and manages infrastructure assets on behalf
of OMERS; one of Canada’s largest pension funds.
EQT Infrastructure and Fortistar acquired 70% and 30% respectively in MCV in
May of 2009. A strategy to improve efficiency, reliability and capacity of the
plant has been successfully executed through the implementation of an
extensive operational improvement program. MCV has also begun development and
permitting work for a 640 megawatt expansion of the facility, which would
enable it to expand its electricity and steam service to existing customers
and potentially provide these services to additional customers. Sales (net of
fuel and purchased power) and EBITDA have as a result of the implemented
measures increased by 27% and 49% respectively from 2009 to 2012.
“MCV has enhanced its ability to provide reliable electricity and steam to its
customers and the local community for many years to come. The focused
operational improvement strategy has substantially exceeded the original
expectations which we attribute to the extraordinary commitment of the MCV
employees to implement this strategy. EQT Infrastructure and Fortistar are
divesting a company which is more reliable, more energy efficient and better
positioned for its future than when it was acquired,” says Glen Matsumoto,
Partner at EQT Partners, Inc., Investment Advisor to EQT Infrastructure.
“During the ownership by EQT Infrastructure and Fortistar, MCV has been
through a transformation that only few could have imagined back in May 2009. I
am very proud that the operational performance of the plant has increased
significantly while employee safety has further improved. The employees of MCV
are excited about continuing their commitment to operational excellence under
the ownership of Borealis,” says Roger Kelley, CEO of MCV.
Mark Comora, President of Fortistar, said, “We are pleased to have had the
opportunity of working with EQT Infrastructure and the MCV management team for
the past three years. It is a testament of what can be achieved when everyone
works together towards one common goal – to provide cost effective, reliable
and environmentally sensitive power for Michigan.”
“MCV is an excellent facility with a strong management team, and it is exactly
the type of large-scale infrastructure asset we look for to help us generate
consistent, long-term returns,” said Michael Rolland, Borealis President and
CEO. “Our teams in both Toronto and New York look forward to working with the
MCV management team and building on the success that they have been able to
achieve over the past few years.”
The transaction is expected to close by year-end and is subject to receipt of
regulatory approvals and satisfaction of customary closing conditions.
EQT Infrastructure and Fortistar have been advised by Credit Suisse, RBC
Capital Markets and Shearman & Sterling. Advisors for Borealis included Torys
EQT is the leading private equity group in Northern Europe with over EUR 19
billion in raised capital and multiple investment strategies. Together with a
superior network of independent Industrial Advisors, EQT implements its
investment strategy by acquiring or financing good medium-sized to large
companies in Northern and Eastern Europe, Asia and the United States,
supporting their development into leading companies. Development is achieved
by an industrial strategy with focus on growth. Since inception, EQT has
invested more than EUR 10.8 billion in around 100 companies and exited close
to 50. EQT-owned companies have more than 550,000 employees.
EQT Partners, acting as investment advisor to the managers of each EQT fund,
has around 120 investment professionals with an extensive industrial and
financial competence. EQT Partners and its affiliates have offices in
Copenhagen, Frankfurt, Helsinki, Hong Kong, Oslo, London, Munich, New York,
Shanghai, Singapore, Stockholm, Warsaw and Zurich.
More information can be found on www.eqt.se.
Fortistar, headquartered in White Plains, New York, has a 25 year history of
investing in and managing power assets. Fortistar currently has ownership
stakes in over 60 projects in North America with total generation capacity of
3,000 megawatts. Fortistar also has a growing renewable business which
currently focuses on the landfill gas and biomass sectors. These portfolios
have a total capacity of about 400 Megawatts. Fortistar has a strong record of
operational excellence and demonstrated capability of enhancing output and
improving efficiency at its other facilities.
More information can be found on www.fortistar.com.
MCV, based in Midland Michigan, is the largest natural gas fired, combined
cycle cogeneration plant in the United States with a nominal capacity of 1,633
MW of electricity and 1,500 kp/hr of steam that commenced commercial operation
in 1990. A significant portion of capacity (~80% or 1,240 MW) has been
contracted to Consumers Energy until 2025 with up to an additional ~10% (or
150 MW) contracted to DOW until 2025.
More information can be found on www.midcogen.com.
About Borealis Infrastructure
Borealis Infrastructure is a leader in direct infrastructure investing with
over a decade of investment experience and almost USD 20 billion in capital
under management. Borealis invests in and manages a diversified portfolio of
large-scale infrastructure assets exhibiting stability and strong cash flows,
in sectors including energy, transportation and government-regulated services.
It has offices in Toronto, London and New York. Borealis is the infrastructure
investment arm of the OMERS Worldwide group of companies. OMERS is one of
Canada’s largest pension funds with net assets of more than CAD 55 billion and
a AAA credit rating.
More information can be found on www.borealis.ca.
Glen Matsumoto, +1-914-607-4502
Partner, EQT Partners
Johan Hähnel, +46 8 506 55 334
Mark Comora, +1-914-421-4949
Nadeem Nisar, +1-914-421-4946
Roger Kelley, +1-989-633-7900
Lori McLeod, +1-416-369-2399
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