On Tuesday, Global Infrastructure Partners (GIP), one of the world’s largest independent infrastructure investors, with $69 billion in funds managed across a portfolio of energy, water, waste and transportation infrastructure assets, announced a major U.S. energy acquisition. GIP is buying the renewable energy business of Palo Alto, California-based private fund manager and energy investor MAP Energy.
Under terms of the deal, GIP’s fourth flagship fund, GIP IV, will acquire 100 percent of the MAP RE/ES investment platform, team, and renewable energy assets under management. The transacted assets include a portfolio of producing royalty interests across more than 16,000 MW of operating wind and solar projects in the United States, as well as a nationwide development pipeline managed through joint ventures with leading national and regional development partners. Per GIP, the MAP RE/ES business will continue to be led by its existing investment team.
According to a statement from the company, the transaction builds upon GIP’s global renewables investment strategy and proven track record of value creation. GIP’s current portfolio includes approximately $9 billion of equity investments and commitments in the sector, and ownership interests in over 10 GW of operating renewable assets and over 65 GW under construction or in development.
Speaking upon the deal’s announcement on Tuesday, GIP Chairman and Managing Partner Adebayo Ogunlesi said, “We are excited to announce the acquisition of MAP’s world-class renewables business. MAP RE/ES has been one of the most successful investors in U.S. renewables and has created an attractive, extremely diversified portfolio that includes exceptionally high-quality operating cash flow from the royalty interests and the opportunity to invest additional capital in a leading development pipeline. We look forward to working with the team that built this highly successful business.”
“Partnering with a global leader in infrastructure investing that also shares our values and philosophy is a rare opportunity,” added MAP RE/ES CEO Aaron Zubaty. “Our team is delighted to collaborate with GIP to advance more than 15 years of work to date as we continue the meticulous management and growth of our assets.”
What a month
The deal caps off a busy December for Global Infrastructure Partners. Earlier this month, the firm announced that it had successfully completed fundraising for two infrastructure credit funds, with aggregate committed capital of $2.8 billion from GIP’s existing investor base along with new investors. These included public and private pension plans, sovereign wealth funds, insurance companies, financial institutions, asset managers, endowments and high net worth individuals located across North America, Europe, Asia and the Middle East.
The funds garnered significant support from GIP’s existing investor base, while also attracting new investors with a “specific interest in infrastructure credit.”
One of the two funds, GIP Credit has already closed or announced four investments: a $110 million secured holding company term loan investment in Puerto Antioquia, a greenfield multipurpose port terminal in Colombia; the purchase of $325 million of an aggregate of $400 million senior secured notes issued by Whistler Pipeline, a greenfield natural gas pipeline that will connect the Permian Basin to the Agua Dulce hub near Corpus Christi, Texas; a $67.5 million participation in a second lien term loan investment in Grupo Via Central S.A. which was established to design, construct, rehabilitate and maintain a 273 kilometer freight railroad connecting central Uruguay to the capital port city of Montevideo; and a $325 million secured term loan to Saavi Energia, the fourth largest independent power producer in Mexico.
As for its deal counterpart, MAP Energy is one of the longest-standing private energy investment firms in the U.S., having grown since its establishment in 1987 to manage a $1.4 billion portfolio of U.S. natural gas royalty investments. Since 2005, MAP has been an innovative investor in onshore renewable energy projects, including wind energy, utility-scale solar, and energy storage.
MAP is also credited with inventing the renewable energy royalty structure that has now become an industry standard.
