Updated: Competitive Power Ventures Enters Agreement To Be Sold To International Electricity Supplier

October 13, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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Global Infrastructure Partners (GIP) announced today that it has entered into a Purchase and Sale Agreement with an affiliate of OPC Energy (OPC), a competitive Israeli electricity supplier and generator whose business includes sales to private customers.

Under the agreement, OPC and its partners will acquire 100% of GIP's interest in Competitive Power Ventures (CPV), including all its operating assets, development pipeline and asset management business.

Kenon Holdings Ltd., the parent of OPC Energy Ltd., said that, "Consideration for the acquisition is $630 million (payable in cash), subject to post-closing adjustments based on closing date cash, working capital and debt. Additionally, an amount in the range of $54 million to $95 million is payable by the Buyer in respect of CPV's equity in the Three Rivers project, which is currently under construction, which may be paid at the Buyer's option in cash or a vendor loan at terms that have been agreed between the parties."

As previously reported, OPC had earlier announced that it has signed a letter of intent to acquire control of a CPV. More background on OPC's financing for the transaction as well as its plan for CPV can be found in our prior story

OPC plans to invest significant capital in CPV to fund its future growth.

OPC will own 70% of the newly formed entity; the remaining 30% will be owned by three Israeli institutional investors relating to the following entities: Clal Insurance Enterprise Holdings Ltd. Group (12.75% interest), Migdal Insurance and Financial Holdings Ltd. Group (12.75% interest) and Poalim Capital Markets (4.5% interest). The total investment obligations of all the limited partners amount to $815 million, based on their respective ownership interests, representing obligations for acquisition consideration as well as funding of additional investments in the Buyer and in CPV for implementation of certain new projects being developed by CPV.

OPC plans to continue to grow CPV, with a focus on renewable and combined-cycle gas turbine projects.

There are no plans to change the existing CPV leadership team.

As the first privately held electricity company in Israel, OPC operates in the field of power generation, including the development, construction and operation of power plants, and supplies energy to private customers and the Israel Electricity Corporation.

The closing of this transaction and regulatory approval is expected to occur in early 2021.

CPV said that it has ownership interest in 5.3 GW of clean generation across the United States. The company’s Asset Management division currently manages more than 10.6 GW of fossil and renewable generating facilities in nine states for 13 different owner groups.

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