Guy Hands Said to Negotiate Wind Farm Sale to China State Giant

  • Huadian in talks for potential $500 million Infinis deal
  • Terra Firma first invested in the U.K. company in 2003

Terra Firma Capital Partners, the buyout firm founded by Guy Hands, picked state-owned power generator China Huadian Corp. as the preferred bidder for its U.K. wind farm business, people with knowledge of the matter said.

The private equity firm is in discussions to sell Infinis Energy Plc’s wind-farm operations to Huadian for about $500 million, according to the people, who asked not to be identified because the information is private. Huadian is currently assessing the impact of the Brexit vote on the Infinis business, and there’s no certainty it will proceed with a transaction, one of the people said.

Chinese President Xi Jinping has sought to cut pollution and spur investment in non-fossil fuels. Companies from the world’s second-largest economy have announced about $5.1 billion of overseas alternative energy acquisitions in the past year, up 47 percent from the prior 12 months, data compiled by Bloomberg show.

State-owned China Three Gorges said last month it will buy control of German wind farm operator WindMW GmbH from Blackstone Group LP. Huadian agreed in 2014 to purchase Gamesa Corp. Tecnologica SA’s 28-megawatt wind farm in Cuenca, Spain, for an undisclosed amount. 

Bolt-On Deals

Terra Firma first invested in Infinis in 2003 through its purchase of landfill operator Waste Recycling Group Plc. It then grew the business through a series of bolt-on acquisitions before listing it on the London stock exchange in November 2013. Terra Firma then repurchased the outstanding shares of Infinis in an October 2015 deal valuing the company at 555 million pounds ($717 million), or about 30 percent less than what it was worth at its listing.

Infinis currently operates 16 U.K. onshore wind farms with a total installed capacity of 274 megawatts, with another 170 megawatts in development, according to the company’s website. Any deal with Huadian would not include Infinis’s landfill gas unit, which Terra Firma is selling separately, the people said. 

A spokesman for Terra Firma declined to comment, while a spokesman for Infinis didn’t respond to e-mailed questions. A Beijing-based spokesman for Huadian didn’t immediately respond to e-mails seeking comment.

Huadian’s main business generates more than 200 billion yuan ($29.9 billion) of annual revenue, according to its website. The state-owned electricity producer holds stakes in seven listed companies including Huadian Fuxin Energy Corp., which owns renewable power projects in China including wind farms and hydropower plants, according to the website. 

The group’s main listed arm is Huadian Power International Corp., which trades in Hong Kong and Shanghai with a market value of about $6.8 billion. 

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