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Calpine $CPN to Acquire Noble Americas Energy Solutions for $900M

Calpine $CPN to Acquire Noble Americas Energy Solutions for $900M

Calpine Corp. (NYSE: CPN) said it agreed to acquire San Diego-based Noble Americas Energy Solutions, one of the top energy retailers in the US, from Hong Kong-based Noble Group (SGX: N21), one of the top three independent global LNG traders, for $900 million, consisting of a purchase price of $800 million plus an estimated $100 million of net working capital at closing. Calpine is America’s largest generator of electricity from natural gas and geothermal resources. Its fleet of 84 power plants in operation or under construction represents more than 27,000 megawatts of generation capacity, serving customers in 20 states and Canada. The move comes after the resignation of Noble Group’s CEO Yusuf Alireza, and his replacement by William Randall and Jeff Frase, who were appointed as Co-CEOs, in late May, at which time Noble Americas was put up for sale, as previously reported by ExitHub. Alireza, the former co-president of Goldman Sachs in Asia, had joined Noble in 2012. Noble Group was accused last year, during his tenure, of overstating its assets by billions of dollars, seeing its market value drop by nearly 75%, and its debt downgraded to junk status. “The sale of Noble Americas substantially completes the $2 billion capital raising initiative that we announced in June,” said Frase and Randall. “With this divestiture, Noble will continue to reduce debt while also funding growth opportunities in our high return businesses.” “We are excited to be acquiring the best commercial and industrial direct energy sales platform in the U.S. The acquisition of this well-regarded organization known for providing sophisticated customers with highly customized products is a natural fit with Calpine’s customer-centric culture and will allow us to build upon the success we have experienced since our entry into retail last year through the Champion Energy platform,” said Thad Hill, Calpine’s president and chief executive. “In addition to expanding our retail customer sales channels and product offerings, we will more than double the volume of retail load we are capable of serving across the country from our complementary wholesale power generation fleet.” “Financially, this transaction is highly cash flow and credit accretive, given a rapidly amortizing bridge loan, the achievement of collateral synergies and the ongoing generation of stable and substantial cash flows,” concluded Hill. The deal is expected to close in December 2016, subject to approval by Noble shareholders, regulatory approvals, and customary closing conditions. The organization will remain headquartered in San Diego and will continue to operate under the leadership of Jim Wood, president of Noble Americas. Operating cash flows from Noble Americas will continue to accrue to Noble until closing. The divestiture also releases approximately $275 million in letters of credit and surety bonds representing additional working capital which will become available to Noble. Calpine expects to fund the acquisition with a combination of cash on hand and temporary bridge loan financing of up to $550 million. Calpine expects to recover approximately $200 million through collateral synergies and the runoff of acquired legacy hedges, substantially within the first year, resulting in expected net cash deployed of approximately $700 million, including working capital, or approximately five times Noble Americas’ recent and expected run-rate adjusted EBITDA. In March 2016, Noble Group completed the sale of its remaining 49% stake in Noble Agri to COFCO International Ltd. for US$750 million in cash, with the additional retention of upside participation in the future growth of Noble Agri, worth up to US$200 million. Noble is using the entire proceeds of the disposal to pay down debt. Noble Group manages a portfolio of global supply chains covering a range of industrial and energy products. Operating from over 60 locations, Noble facilitates the marketing, processing, financing and transportation of essential raw materials. Sourcing bulk commodities from low cost regions such as South America, South Africa, Australia and Indonesia, the group supplies high growth demand markets, particularly in Asia and the Middle East. The company is ranked No. 77 in the 2015 Fortune Global 500. Noble Americas is a leading power marketer focused on offering supply and risk management services to commercial and industrial customers. Strategically, the company acts as a conduit for customers to manage their price and energy risk exposure. It buys energy wholesale and repackages that energy into retail products. It continually develops products and risk management tools that change the manner in which customers think about, and manage, their energy expenditure. The company has grown its gross margin and EBIT nine of the last ten years and its retention rates are among the highest in the industry. Noble Americas has been recognized for changing the face of US deregulated power by providing an industry leading web-enabled risk management solution, PowerFolio3D. This platform provides customers with the ability to analyze their potential risk to produce strategies, and to mitigate that risk and enhance the value in their portfolios. It currently operates out of six locations – its headquarters are in San Diego, with regional offices in Boston, Michigan, Chicago, New Jersey and Houston. The company has 210 employees and is currently the fifth largest commercial and industrial retail marketer in the US according to DNV-GL, formerly Kema. It has approximately 1,300 consumer clients and over 100,000 meters with demand requirements of approximately 8,000 MW per year. Noble Americas provides retail electricity in all 19 deregulated states in the US and natural gas in the Western US, primarily California and Nevada. During 2015, on average, the company invoiced 85,500 accounts per month with a 99.95% accuracy rate. It was also awarded an extension to ISO 9001:2008 certification, which is a robust process and procedure audit.]]>

Tycoon Chen Feng, HNA Taking Over $CIT Aircraft Leasing Unit for $10B

Tycoon Chen Feng, HNA Taking Over $CIT Aircraft Leasing Unit for $10B

Asian Global Aviation Hegemony As reported by ExitHub earlier this year, more than a dozen entities were invited to submit bids for CIT’s aircraft leasing business, with a preponderance of Asian bidders, given the growing Asian demand and shifting balance of the global aviation industry to Asia. As airlines serving Asia Pacific are attempting to expand their fleets, they’re finding that the leasing business can be more lucrative than operating an airline. The move comes after BOC Aviation Ltd. (HKG: 2588), an arm of Bank of China, the country’s fourth-largest lender by assets, made a $1 billion IPO in Hong Kong for its aircraft leasing business, BOC shares began trading on June 1. BOC Aviation was the second aircraft leasing company listed in Asia after China Aircraft Leasing Group (CALC) floated its shares in Hong Kong two years ago. BOC Aviation’s fleet is nearly four times bigger than CALC’s though, at almost 230 planes. Malaysian low-cost airline AirAsia Berhad (MYX: 5099) is also planning to divest ts aircraft leasing subsidiary Asia Aviation Capital Ltd., while rivals CDB Leasing and Minsheng Financial Leasing, where reportedly preparing to list in Hong Kong later this year. The CIT Group CIT Commercial Air owns, finances and manages a fleet of more than 350 commercial aircraft serving approximately 100 customers in 50 countries. The company offers an array of industry-leading services, supported by a fleet of Airbus, Boeing, Embraer and Bombardier aircraft. CIT has seven aircraft leasing, advising and syndication offices in Dublin, Ireland; Ft. Lauderdale, Fla.; Los Angeles, Calif.; New York, N.Y.; Seattle, Wash.; Singapore; and Toulouse, France. Founded in 1908, CIT is a financial holding company with more than $65 billion in assets. Its principal bank subsidiary CIT Bank NA, has more than $30 billion of deposits and more than $40 billion of assets. It provides financing, leasing and advisory services principally to middle market companies across more than 30 industries primarily in North America, and equipment financing and leasing solutions to the transportation sector. It also offers products and services to consumers through its Internet bank franchise and a network of retail branches in Southern California, operating as OneWest Bank, a division of CIT Bank. The company is headquartered in Livingston, N.J. CIT has received a “non-objection” from the Federal Reserve Bank of New York for its Amended Capital Plan subject to the closing of the transaction. The Amended Capital Plan authorizes CIT to return $2.975 billion of common equity to shareholders from the net proceeds of the sale; return up to an additional $0.325 billion of common equity contingent upon the issuance of a similar amount of Tier 1 qualifying preferred stock; and pay common dividends totaling $64 million per year after the transaction is completed, subject to quarterly approval by the CIT Board of Directors. “The sale of CIT Commercial Air represents an important milestone for CIT and follows an extensive dual-track process that was designed to maximize shareholder value. This transaction will strengthen our balance sheet, simplify our business and enable us to return significant capital to our shareholders,” said Ellen R. Alemany, chairwoman and chief executive of CIT Group. “We are making meaningful progress on our strategy to create a leading national middle-market bank.” HNA Group HNA, a leader in aviation and tourism, was founded in 1993 by Chen Feng. Over the past two decades, it has grown from a local aviation transportation operator into a multinational conglomerate encompassing Aviation, Holdings, Tourism, Capital, Logistics and EcoTech. Prior to founding HNA, Chen Feng served as an aviation advisor to the governor of Hainan Province, and presided over the formation and subsequent restructuring of Hainan Airlines. He also created and served as chairman of Grand China Air Co. to hold the airline assets of the HNA Group. During China’s Cultural Revolution, he reportedly worked for the People’s Liberation Army Air Force, and after 1979, he worked at China’s Civil Aviation Administration, and the National Air Regulations Bureau. In 1984, he graduated from the Lufthansa College of Air Transportation Management in Germany. In 1995, he obtained an MBA degree from the Maastricht School of Management in the Netherlands, and in 2004 he obtained a diploma from Harvard Business School. Feng was born in Huozhou, Shanxi province and raised in Beijing. HNA Group aspires to become one of the top 50 companies in the world by 2030, it says. In 2015, HNA had revenues of nearly RMB190 billion ($28.6 billion), total assets of over RMB 600 billion ($90 billion) and employed nearly 180,000 employees worldwide. HNA is headquartered in Haikou, Hainan, China. Yesterday, HNA EcoTech said it agreed to acquire Beijing-based information technology (IT) outsourcing services provider Pactera Technology International Ltd. from New York global private equity firm Blackstone Group (NYSE: BX) and other shareholders. The purchase price was reportedly $675 million. In early August, HNA Group agreed to invest $336 million in San Francisco-based RocketSpace, a leading technology accelerator campus and co-working space for high-growth startup, in a strategic joint venture deal to fuel RocketSpace’s global expansion, including China. A few days later, HNA’s subsidiary Hainan Airlines Co. Ltd. acquired a 24% stake in Brazil’s third largest airline Azul SA for $450 million, becoming its largest single shareholder. In February, HNA agreed to acquire Ingram Micro Inc. (NYSE:IM) for $6 billion, the largest Chinese takeover of a US information technology company. Photo: Chen Feng, Founder & Chairman of HNA Group.]]>

Onex $OCX and Baring Asia to Acquire IP&S Unit From @ThomsonReuters $TRI for $3.55B

Onex $OCX and Baring Asia to Acquire IP&S Unit From @ThomsonReuters $TRI for $3.55B

Reuters, which provides real-time multimedia news and information services to newspapers, television and cable networks, radio stations, and websites. The company was formerly known as The Thomson Corporation and changed its name to Thomson Reuters Corporation in April 2008. Thomson Reuters was founded in 1799 and is headquartered in New York City. The company has a market capitalization of $31.23 billion.]]>

PE Firm Permira Looking to Sell Asia Broadcast Satellite Operator ABS

PE Firm Permira Looking to Sell Asia Broadcast Satellite Operator ABS

SpaceNews. Referring to Permira, Choi commented further, “They came in after we had acquired in-orbit satellite capacity from other satellite operators. We had grand ambitions for new satellites. They put in a big chunk of new equity, which gave us the financing to do the ABS-2, ABS-2A and ABS-3A satellites.” “Their fund has reached a time where they need to return the invested capital back to the partners,” Choi said. “It’s only natural they are seeking an exit. It’s just the way financial sponsors are, they’re limited to 5-10 years. So whoever steps up and buys ABS is going to buy a fantastic company.” Choi, who built a strong multi-regional business in a short space of time, was recognized in 2012 as the Via Satellite Executive of the Year. “Tom Choi has built up Asia Broadcast Satellite at a remarkable pace,” said Mark Holmes, editor of Via Satellite. “Choi makes brave decisions from acquiring satellites, securing financing, to commissioning new satellites. In 2012, this approach reached a new level when ABS teamed up with Satmex to order four of Boeing’s new 702SP small platform satellites, and launched them on SpaceX Falcon 9 rockets.” ABS offers a complete range of End-to-End solutions including Direct to Home (DTH), Cable TV distribution (CATV), Cellular Backhaul, VSAT and Internet Backbone services with diverse IP transit through its European, Middle East and Asian internet gateways. ABS is a young and fast growing global satellite operator, with an entrepreneurial and creative business approach. Headquartered in Bermuda, ABS has offices in the United States, Dubai, South Africa, Germany, Philippines, Indonesia, Malaysia, Singapore and Hong Kong. Permira is a global investment firm that finds and backs successful businesses with ambition. The firm advises funds with a total committed capital of approximately €25 billion (US$28 billion). The Permira funds make long-term investments in companies with the ambition of transforming their performance and driving sustainable growth. In the past 30 years, the Permira funds have made over 200 private equity investments in five key sectors: Consumer, Financial Services, Healthcare, Industrials and Technology. Permira employs over 200 people in 14 offices across North America, Europe, the Middle East and Asia. The firm was founded in 1985 and previously operated under the Schroder Ventures brand. After raising its first pan-European fund in 1997, the firm became Permira following a rebrand in 2001. Historically, Permira has been a leading investor in the satellite industry with substantial ownership stakes in Intelsat and Inmarsat. With Permira’s support, ABS has reached a number of significant milestones. ABS-2 was launched in February 2014 – one of the largest satellites ever launched in the Eastern Hemisphere, with the potential to at least double the sales and earnings potential of ABS. ABS-3A was launched in March 2015 – a ground-breaking satellite with an innovative design to connect the Americas, Europe, Africa and the Middle East. ABS is now operating a fleet of six satellites from six orbital locations, and is on its way to becoming one of the top 5 Fixed Satellite Service operators globally. During the past five years, the number of its physical transponders grew from 103 to 348.]]>