Photo: Gevo Isobutanol Plant at Luverne, Minnesota.]]>
Renovalia solar panels in Puertollano, Spain.[/caption]
Renovalia Energy was created more than ten years ago in Villarrobledo, Spain, to provide electricity for the industrial company of the Ortega Martínez family, Grupo Forlasa. In a major strategic turnaround, the Ortega family subsequently moved away from its Forlasa dairy business to focus its efforts on renewable energy. Grupo Forlasa was created in 1970 by Bernardo Ortega. The French company Lactalis took over Ortega’s Grupo Forlasa in 2010. Juan Domingo Ortega, the family patriarch and Renovalia’s president, died in 2014.
In conjunction with its acquisition of Renovalia, Cerberus also said that Jose Luis Marín has joined as chairman of the firm’s renewable energy investments business. Marín has extensive professional experience in both the industrial and energy sectors, including 17 years with Endesa where his most recent responsibilities were as CEO of Endesa Diversificación and president and CEO of Endesa Red.
“We are pleased to welcome Jose Luis Marín to the firm, where his extensive industry experience will be a great asset,” said Lee Millstein, Head of European Investments. “Along with our recent acquisitions, this move significantly advances our renewable energy investment strategy in Europe. We look forward to growing owned operating assets and expanding Renovalia’s asset management and operation and maintenance (“O&M”) capabilities globally.”
Cerberus was advised on legal matters by Watson Farley & Williams LLP and Ashurst LLP. Financial due diligence was provided by KPMG, technical due diligence by G-advisory, and insurance by Aon Insurance. Renovalia was advised on legal matters by Bird & Bird LLP.
Cerberus Capital Management, L.P. is one of the world’s leading private investment firms. Founded in 1992 by its CEO Steve Feinberg, Cerberus has more than $29 billion under management invested in four primary strategies: private equity; real estate-related investments; commercial mid-market lending; and distressed securities & assets.
Cerberus (Kerberos in Greek) is named after a mythological three-headed dog. The firm is headquartered in New York City and has a large network of affiliate and advisory offices in the U.S., Europe and Asia. Cerberus invests in multiple sectors around the world. Former U.S. Vice President Dan Quayle, serves as chairman of the firm’s global investments, and former U.S. Secretary of the Treasury John W. Snow, serves as the firm’s chairman.
Ormat Technologies Inc. Announces $175 Million Agreement with Northleaf Capital Partners for a 40% Equity Investment in Certain Power Plants at a Valuation of $438 Million
Portfolio of 106 MW includes two geothermal facilities and three REG power plant complexes
Ormat to retain day-to-day managerial and operating control over the portfolio
Israeli-American renewable geothermal energy firm Ormat Technologies, Inc. (NYSE: ORA; TASE: ORMT) announced that its wholly-owned subsidiary Ormat Nevada has entered into a binding agreement with infrastructure funds managed by Northleaf Capital Partners under which Ormat will contribute certain geothermal and recovered energy generation power plants into a newly established holding company subsidiary, and Northleaf will acquire an approximately 40% equity interest in the JV. The Company will raise approximately $175 million from the transaction. The transaction is expected to close in the first quarter of 2015, subject to customary closing conditions.
The power plants that will be contributed to the JV as part of the transaction include Ormat’s Puna geothermal power plant in Hawaii, the Don A. Campbell geothermal power plant in Nevada, and nine power plant units across three recovered energy generation assets known as OREG 1, OREG 2, and OREG 3. Ormat will continue to consolidate the JV and its assets, and will continue to provide day-to-day management control, operations and maintenance control over the projects.
Northleaf is a leading independent global private equity and infrastructure manager, with offices in Toronto, Canada, London, UK and Menlo Park, USA and more than $6 billion in commitments under management. Northleaf’s infrastructure program is focused on long-term investments in core assets in OECD member countries.
As part of the transaction the parties agreed that any future development of the assets will be undertaken within the JV.
“This milestone transaction represents a significant opportunity for Ormat to strengthen its balance sheet by monetizing operational assets at an attractive valuation,” commented Isaac Angel, Ormat’s CEO. “Our transaction process initially identified a number of global institutional and private equity infrastructure investors seeking long term stable investment opportunities. We are delighted to join forces with Northleaf, based on the strength of their substantial and meaningful interest in our geothermal and recovered energy plants. The valuation, which represents a premium to our current trading valuation, reinforces the value of our operational assets and underscores our experience and proven track record. By partnering with a proven and strong capital partner we are highlighting the potential for future transactions and additional growth opportunities together.”
“During this period of volatility in global energy markets and commodities pricing, we worked closely with our new investor to structure an arrangement related to our Puna geothermal power plant that provides Northleaf a stable energy rate,” added Mr. Angel. “This arrangement mitigates Northleaf’s exposure to fluctuations in energy prices, while Ormat stands to benefit from the upside when prices improve.”
“Direct investments in contracted geothermal assets in partnership with a world-leading company such as Ormat are consistent with Northleaf’s strategy and offer significant potential for stable, long-term returns,” said Northleaf Managing Director, Jamie Storrow. “The partnership with Ormat is very appealing to us, given the company’s reputation as a leading geothermal manufacturer, operator and developer. We look forward to maintaining a productive and long-term relationship with Ormat.”
With over four decades of experience, Ormat Technologies is an Israeli-American leading geothermal company and the only vertically integrated company solely engaged in geothermal and recovered energy generation (REG). The company owns, operates, designs, manufactures and sells geothermal and REG power plants primarily based on the Ormat Energy Converter – a power generation unit that converts low-, medium- and high-temperature heat into electricity. With over 77 U.S. patents, Ormat’s power solutions have been refined and perfected under the most grueling environmental conditions. Ormat has 480 employees in the United States and about 640 overseas. Ormat’s flexible, modular solutions for geothermal power and REG are ideal for the vast range of resource characteristics. The company has engineered, manufactured and constructed power plants, which it currently owns or has installed to utilities and developers worldwide, totaling over 1,900 MW of gross capacity. Ormat’s current generating portfolio is spread globally in the U.S., Guatemala and Kenya.