Abu Dhabi fund ADIA invest $500m in US power firm AlphaGen

The Abu Dhabi Investment Authority (ADIA) is investing $500m in a US power infrastructure company owned by ArcLight Capital Partners as the competition to acquire power generation assets intensifies.

The investment by a wholly owned subsidiary of ADIA, Abu Dhabi’s biggest wealth fund, is for a minority stake in AlphaGen. It is subject to regulatory approvals and is expected to close in the first half of 2025.

Formed a year ago by ArcLight Capital Partners to manage and operate the buyout firm’s power infrastructure investments, AlphaGen constitutes one of the largest portfolios of independent power assets in the US, with more than 11 gigawatts (GW) of generation capacity spread across six states.

“This transaction presented an opportunity to expand our existing relationship with ArcLight, which has a long history of successfully investing in power infrastructure and is well positioned through this portfolio to provide the reliable electricity required by AI data centres and local industries,” said Khadem AlRemeithi, executive director of the Infrastructure Department at ADIA.

ArcLight, an energy-focused private equity firm founded in 2001, has owned, controlled, or operated more than 65 GW of generation assets and 47,000 miles of transmission infrastructure.

Meanwhile, ADIA plans to invest more in the private equity sector, underlining its clout as a globally influential dealmaker.

The $1tn fund boosted its targeted allocation to private equity to 12-17 per cent of its overall portfolio, according to its 2023 annual review that was published last November.

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