I Squared expands hydro portfolio

The New York fund manager, through its portfolio company Cube Hydro, has added two run-of-the-river facilities to its portfolio of hydropower assets.

Cube Hydro Partners, a portfolio company of New York-based I Squared Capital (ISQ), has closed on its acquisition of Lyonsdale Associates for an undisclosed amount, the infrastructure investment firm said in a statement.

With the closing of the transaction, Cube Hydro will hold an 82.8 percent interest in Little Falls Hydro, a 13.6-megawatt (MW) hydroelectric plant, and 100 percent ownership of Lyonsdale Hydro, a 3MW plant, both located in upstate New York.

Both facilities operate under long-term power purchase agreements with National Grid, a multinational electric and gas utility, a spokesperson for I Squared told Infrastructure Investor.

“This transaction expands our portfolio of hydropower assets in regional platforms with operational synergies,” Cube Hydro’s chief executive Kristina Johnson said. “We continue to pursue the acquisition and optimization of existing hydro assets, as well as the development of new projects at un-powered dams and irrigation canals.”

I Squared established Cube Hydro, along with Enduring Hydro, in January 2014 as a joint venture focusing on investments in mid-sized greenfield and operating hydro projects in the US and Canada. I Squared’s investment was made through the ISQ Global Infrastructure Fund, the debut vehicle the firm began raising in September 2013.

Last month, Infrastructure Investor reported that the investment manager had exceeded its original $2 billion target and is expected to conclude fundraising in early 2015.

Founded in 2012 by former executives of Morgan Stanley including Sadek Wahba, Gautam Bhandari and Adil Rahmathulla, I Squared Capital specialises in energy, utilities and transport in the US, Europe and select high-growth markets.