GIP to buy Singapore-based Equis in record-breaking US$5b renewable power deal

A general view of Equis Energy's 30 Megawatt solar asset in Aomori Prefecture, Japan.
A general view of Equis Energy's 30 Megawatt solar asset in Aomori Prefecture, Japan.PHOTO: REUTERS

HONG KONG (BLOOMBERG) - Investment fund Global Infrastructure Partners agreed to buy Equis Energy, a Singapore-based developer of renewable-power projects, for US$5 billion including debt, a record for the industry.

The deal includes US$1.3 billion of liabilities and is expected to close in the first quarter, the companies said in a joint statement on Wednesday (Oct 25). The portfolio of assets includes solar, wind and hydroelectric power operations from Australia to India.

Renewable-power projects are attracting more investor interest as governments throughout Asia seek alternatives to fossil fuels to meet rising energy demand and combat pollution. Equis Energy, which is developing one of the largest solar plants in Australia, has 180 assets with installed capacity of more than 11 gigawatts.

The size of the deal "may be a signal that scale is also important in the renewable-energy industry as traditional tariff structures and incentives are dismantled and costs need to be reduced to improve investment returns," Tom O'Sullivan, founder of Tokyo-based energy consultant Mathyos, said by email.

Equis Energy is the largest independent renewable-energy power producer in Asia Pacific, operating across Australia, Japan, India, Indonesia, the Philippines and Thailand, according to the statement. The acquisition is the biggest ever for the renewables industry, according to the companies and Bloomberg New Energy Finance.  Equis Energy "is a strong fit with GIP's global renewable-investment strategy," Adebayo Ogunlesi, GIP's chairman and managing partner, said in the statement.

Credit Suisse Group AG and JPMorgan Chase & Co. were financial advisers for Equis Energy, with Skadden, Arps, Slate, Meagher & Flom LLP acting as legal adviser. Clifford Chance LLP advised GIP, the companies said.

Global Infrastructure Partners III fund is buying Equis Energy with investors including Canada's Public Sector Pension Investment Board and China's CIC Capital Corp, it said in a separate statement.