Summary: Infracapital, the infrastructure equity investment arm of M&G Prudential, has entered into a joint venture (‘the JV’) with Enel X, the advanced energy services business line of global energy corporation, Enel, to create a platform to develop energy efficiency projects for commercial and industrial companies in Italy.
Initially this will see Infracapital Greenfield Partners I LP (‘the Fund’) acquire the majority stake in a portfolio of eleven Combined Heat and Power (‘CHP’) projects in Italy from Enel X. The projects, which are either operational or in construction, represent a total of 27.5MW of power capacity. Additionally, the JV has a strong identified development pipeline of further projects expected to deliver over 20MW annually.
The portfolio offers the potential for the JV to operate in ancillary services such as demand response to grid by optimising the use of the CHP infrastructure it owns. The JV will also seek to capitalise on growth opportunities in non-traditional energy assets such as alternative energy efficiency technologies, distributed generation, energy storage and EV charging infrastructure.
The Fund will take an 80% stake in the JV, providing capital alongside Enel X to fund future growth, with Enel X leveraging its specialist knowledge and presence in the Italian energy efficiency market to manage the CHP projects and source new investment opportunities.
The JV represents the eighth platform investment by the Fund. The Fund’s strategy is to invest in the later stage development, construction and expansion phases of European infrastructure projects and companies across a variety of sectors.
Michele Armanini, Greenfield Director at Infracapital, said:
“We are delighted to announce our Greenfield fund’s eighth acquisition and mark the beginning of our partnership with Enel X, a new and exciting player in the global energy sector. We look forward to working closely with them to expand the JV and tap into the exciting growth opportunities that are present right across the industry.”
Infracapital was advised by Guggenheim Partners.
Enel X is a new Enel global business line dedicated to developing innovative products and digital solutions in sectors in which energy is showing the greatest potential for transformation: cities, homes, industries and electric mobility. Its parent company, Enel, is a multinational power company and a leading integrated player in the global power, gas and renewables markets. It is one of Europe’s largest utilities and figures among Europe’s leading power companies in terms of installed capacity and reported EBITDA. The Group is present in over 30 countries worldwide, producing energy with more than 89GW of managed capacity and distributing electricity to around 73 million end users, the largest customer base among its European peers.
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Infracapital invests in, builds and manages a diverse range of essential infrastructure to meet the changing needs of society and support long-term economic growth. We take an active role in all of our investments, whether nascent or large, to fulfil their potential and ensure they are adaptable and resilient. Our approach creates value for our investors, as we target investments with the scope for stable and sustainable growth. Our portfolio companies work closely with the communities where they are based, to the benefit of all stakeholders. Infracapital is well positioned to deliver the significant investment required to help build the future. The founder-led team of experienced specialists has worked with more than 45 companies around Europe and has raised and managed over £5 billion across five funds.
Infracapital is part of M&G Prudential, the European savings and investments business of Prudential plc, the global financial services group. M&G Prudential manages the long-term savings of more than 7 million people and is a major investor in the UK and in the global economy. Total assets under management are £342 billion (as at 30 June 2018).