Paul Hastings, Claro & Cia., Garrigues, Holland & Knight and Morales & Besa advsied on the transaction
Glenfarne Group, LLC, a developer, owner-operator and industrial manager of energy and infrastructure assets, has secured up to $700 million in capital for its subsidiary, EnfraGen, LLC (“EnfraGen”), to fund new investments in the Americas. EnfraGen focuses on the development, acquisition and operation of high-value, long-lived power and power infrastructure assets in the Americas.
The new financings will fund the growth of two EnfraGen subsidiaries, Prime Energía SpA (“Prime Energía”) and Fontus Hydro, LLC (“Fontus Hydro”). Prime Energía will use the proceeds to fund the construction of backup power plants in Chile and refinance existing debt. Fontus Hydro will use the proceeds to acquire three run-of-river hydroelectric power plants in Panama. With these new investments, EnfraGen’s consolidated portfolio of operational and construction assets across its subsidiaries will total approximately 750 MW of capacity in the Americas.
The new financings are to be provided by a syndicate of banks led by Sumitomo Mitsui Banking Corporation (“SMBC”) and Natixis, and by funds managed by affiliates of Apollo Global Management, LLC (NYSE:APO) (the “Apollo Funds”). SMBC and Natixis are acting as mandated lead arrangers and bookrunners for a $400 million syndicated senior secured loan to Prime Energía, with additional lenders expected to join the bank syndicate in the coming weeks. The Apollo Funds are providing EnfraGen with capital of up to $300 million to fund current operational and construction assets and future expansions.
Prime Energía will use the proceeds to construct five new backup power generation plants across Chile and to refinance its existing senior debt. The construction will provide over 500 skilled engineering and construction jobs across multiple regions in Chile. These new power plants will support the growth and adoption of renewable energy onto the Chilean electrical grid by providing backup power that addresses the intermittent generation of renewables and transmission system outages that cause supply/demand imbalances, ensuring stability of the grid. Based on Prime Energía’s market research, an expansion of renewables capacity requires a nearly equal expansion of backup capacity to support the grid’s addition of renewable power sources.
These long-lived, low-risk assets, once complete, will increase Prime Energía’s current capacity to 698 MW. Prime Energía currently owns and operates three backup power plants and one solar PV plant in Chile.
Paul Hastings advised Glenfarne Group with Bob Kartheiser (Picture), Yana Lantsberg, Inho Ko and Bruna Rey.
Claro & Cia. advised Prime Energía SpA Quickstart SpA with Rodrigo Ochagavía, José Luis Ambrosy?, Andrea Sougarret and Jaime Salas.
Garrigues advised Sumitomo Mitsui Banking Corporation (SMBC) and Natixis with Pedro García Morales, Antonio Morales, Francisco Irarrázaval, Federico Espinosa and Felipe Mellado.
Holland & Knight advised Banco Santander Chile with Norberto E. Quintana and Lara M. Ríos.
Morales & Besa advised Banco Santander Chile with Myriam Barahona, Francisca Pérez, Jaime Rosso, Paulo Quinteros and María Francisca Estrougo.
Involved fees earner: Myriam Barahona – Morales & Besa; Paulo Quinteros – Morales & Besa; María Francisca Estrougo R. – Morales & Besa; Francisca Pérez – Morales & Besa; Jaime Rosso G. – Morales & Besa; Rodrigo Ochagavía – Claro y Cia; José Luis Ambrosy – Claro y Cia; Andrea Sougarret – Claro y Cia; Jaime Salas – Claro y Cia; Norberto Quintana – Holland & Knight; Lara Rios – Holland & Knight; Pedro García Morales – Garrigues; Antonio Morales Mutis – Garrigues; Francisco José Irarrázaval Armendáriz – Garrigues; Bob Kartheiser – Paul Hastings; Yana Lantsberg – Paul Hastings; Inho Ko – Paul Hastings;