M&A International Inc. Alternative Energy M&A - Western Reserve ...

12 Alternative Energy M&A
Representative Transactions
Transactions involving acquisitions by utility companies
Date
Announced
30-Sep-09
21-May-09
04-Aug-08
04-Jan-08
07-Aug-07
04-Aug-07
Target Acquiror Deal Synopsis Value
($mn)
AIM PowerGen
Corporation
(Canada)
North
Allegheny
Wind, LLC
(USA)
M & A
Rinnovabili
s.r.l. (Italy)
Airtricity
Holdings
Limited
(Ireland)
ENERGI E2
Renovables
Ibéricas S.L.
(Spain)
Trinergy Ltd.
(wind farms in
Italy and
Germany)
International
Power plc
(UK)
Duke Energy
Corporation
(USA)
Alpiq Holding
AG
(SWX:ALPH)
(Switzerland)
Scottish &
Southern
Energy plc
(UK)
E.ON AG
(DB:EOAN)
(Germany)
International
Power plc
(UK)
AIM PowerGen Corporation develops, constructs and
operates wind power generation facilities in Canada. The
company was founded in 2001 and is headquartered in
Markham, Canada. It was acquired by UK-based
International Power plc.
North Allegheny Wind, LLC owns a wind farm with 35
Gamesa wind turbines, each capable of producing two
megawatts (MW) of electricity, i.e. total power production
capacity around 70 MW. The company was acquired by
Duke Energy Corporation in order to comply with the RPS.
M & A Rinnovabili s.r.l. develops, installs and operates onand
offshore wind farms, solar power and biomass plants.
The company was founded in 2008 and is based in Italy. M
& A Rinnovabili s.r.l. operates as a subsidiary of Moncada
Energy Group s.r.l.
Airtricity Holdings Limited, a renewable energy company,
develops, constructs and operates on- and offshore wind
farms mainly in Europe and Asia. The company was
founded in 1997 and is headquartered in Dublin. Its wind
farm sites are located in England, Wales, the Republic of
Ireland, Scotland, Germany and the Netherlands. Scottish
and Southern Energy plc acquired Airtricity following the
adoption by the EU of a legally binding target of 20% for the
proportion of all energy to be derived from renewable
sources and a decision by the Scottish government to adopt
a new target to generate 50% of Scotland’s electricity from
renewable sources, also by 2020.
ENERGI E2 Renovables Ibéricas S.L. develops and
operates renewable projects including wind farms in Spain
and Portugal. The company is headquartered in Madrid,
Spain. It was acquired by E.ON to further expand its
alternative energy operations in Europe.
On 31 August 2007, key wind farm assets owned by
Trinergy Ltd were acquired by International Power plc. They
were located in Italy (495 MW in operation and 67 MW
under construction) and Germany (86 MW in operation).
Trinergy is headquartered in Dublin, Ireland. The acquisition
allowed International Power plc to expand its alternative
energy assets in Europe.
Value/MW
120.9 N/A
124 1.77
249.7 N/A
3,253.1 N/A
993.6 N/A
1,196 1.85
Source: Copal Analysis, Capital IQ
Between 2007 and 2009, approximately 26% of the
150 largest M&A transactions involved utilities
acquiring pure-plays. The transaction value for such
deals varied widely, ranging between $5.5mn and
$3.6mn.
The value/MW multiple for such transactions has
exceeded annual averages for all deal types, e.g. in
the Duke Energy acquisition of Northern Allegheny in
2009 the value/MW multiple was $1.77mn/MW,
above the year average of $1.4mn/MW. In 2007, the
corresponding ratio for International Power’s
acquisition of Trinergy was $1.85mn/MW,
significantly higher than the year average of
$1.0mn/MW, suggesting that utility companies are
willing to pay a slight premium, especially for targets
possessing large-scale operations and enjoying
adequate grid connectivity.
June 2010
Utility companies have been eager to acquire
alternative energy companies to meet legally binding
renewable energy targets in their respective
countries. As a result, we expect them to continue to
account for a large share of M&A activity in the short
to medium term. However, several larger utility
companies, including E.ON and Scottish and
Southern Energy, have shown a keen interest in
acquiring companies engaged in the development,
construction and operation of wind farms. Such
acquisitions will allow larger utility companies to
undertake alternative energy projects on a much
larger scale and to develop and sell operating assets
to other companies.
M&A International Inc. – the world's leading M&A alliance