Abu Dhabi Future Energy Company PJSC – Masdar has signed a definitive agreement to acquire a 50 per cent stake in US-based Terra-Gen Power Holdings II, LLC (Terra-Gen), one of the largest independent renewable energy power producers in the United States, from Energy Capital Partners (ECP).
ECP shared that it will fully exit its position in Terra-Gen in connection with the transaction, while global infrastructure investment manager Igneo Infrastructure Partners (Igneo) will retain its existing 50 per cent stake in the company.
Founded in 2007, Terra-Gen is an independent provider of end-to-end renewable project development, financing and operating capabilities.
It currently operates approximately 2.4 GW of wind and solar and 5.1 GWh of energy storage facilities across 32 renewable power sites throughout the U.S., largely California and Texas.
Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, said: “Our investment in Terra-Gen’s impressive energy portfolio expands our existing U.S. footprint and reinforces Masdar’s long-term commitment across our U.S. portfolio. This transaction unites one of the largest independent renewable energy producers in the U.S. with Masdar – one of the fastest growing clean energy companies in the world. We look forward to working alongside Igneo as our valued partner to accelerate Terra-Gen’s growth and deliver world-class innovation at utility scale in support of the global energy transition.”
Masdar first invested in the U.S. energy market back in 2019 and its US portfolio of utility scale wind, solar and storage assets has a generating capacity of more than 1.4 GW.
The market is set to play an important role in Masdar’s plan to build a global renewable energy portfolio of at least 100 GW capacity by 2030.
Jim Pagano, CEO of Terra-Gen, commented: “Terra-Gen is committed to developing responsible energy projects that benefit local communities and future generations. We have enjoyed a tremendous partnership with ECP, which allowed us to build a strong and resilient business positioned for long-term growth. As we look to build on our tangible pipeline of projects, we are excited to work with Masdar, a like-minded partner with a track record of commitment to decarbonization and clean energy projects in the U.S. and around the world.”
The transaction is expected to close by the end of 2024, subject to regulatory and other customary approvals.
Lazard and Guggenheim Securities are serving as financial advisors and Latham & Watkins LLP is serving as legal advisor to Terra-Gen.
BMO Capital Markets and JP Morgan are serving as financial advisors and White & Case LLP and Covington & Burling LLP are serving as legal advisors to Masdar.
Mayer Brown is serving as legal advisor to Igneo.