Sydney-based AMP Capital is investing in six thermal-generating assets owned by Invenergy, a clean energy company based in Chicago, by providing a $200 million loan through Infrastructure Debt Fund II (IDF II).
The portfolio of natural gas-fuelled electric generating projects, which has a total capacity of 2.5 gigawatts (GW), comprises St. Clair (584MW) in Ontario, Nelson (640MW) in Illinois and Ector County, a 330MW peaking unit in Texas. They also include three plants Invenergy jointly owns with Marubeni: Hardee (370MW) in Florida, Spindle Hill (314MW) in Colorado and Cannon Falls (357MW) in Minnesota, a spokesperson for AMP Capital told Infrastructure Investor.
The $200 million investment is part of a $540 million term loan Invenergy's subsidiary, Invenergy Thermal Operating I LLC, closed this week. According to a separate statement released by Invenergy, “proceeds from the transaction were used for refinancing debt associated with the operating platform,” which owns 3,159MW of natural gas-fired generation plants. The financing was rated Ba3 by Moody's and B+ by Standard & Poor's.
AMP Capital was the sole lead arranger on the $200 million second lien tranche, while Morgan Stanley arranged the first lien tranche.
AMP's investment marks the second transaction between the two companies. In November 2011, AMP Capital invested in Invenergy’s wind portfolio through IDF I. The fund manager did not disclose the size of the investment at the time and declined to do so for this article.
Last July, Invenergy sold seven contracted wind farms in the US and Canada with a generating capacity of 930MW to TerraForm Power for $2 billion. However, it continues to own the wind farms AMP Capital invested in in 2011, the fund manager’s spokesperson confirmed.
According to Invenergy, the sale of the wind farms represented about one-tenth of its total portfolio.
In addition to natural gas-fuelled power plants and wind farms, the company is also active in solar energy. Since its inception, Invenergy and its affiliated companies have developed more than 9.1GW of projects that are in operation, construction or under contract, including 76 wind, solar, and natural gas-fired power generation projects and energy storage facilities, in North America and Europe, according to its website.
AMP Capital has been investing in the subordinated debt of infrastructure assets since 1998. Currently, its global infrastructure debt team comprises 10 investment professionals in London, New York and Sydney.