Masdar acquires stake in US clean energy producer Terra-Gen

Masdar has announced the acquisition of a 50 per cent stake in Terra-Gen Power Holdings II, an independent renewable energy power producer.

The transaction, facilitated by Masdar, involves the purchase of the said stake from Energy Capital Partners (ECP), a key investor in energy transition infrastructure.

With this acquisition, ECP will fully exit its position in Terra-Gen, while Igneo Infrastructure Partners (Igneo) will retain its existing 50 per cent stake in the company.

Terra-Gen, established in 2007, is recognised as a leading provider of renewable project development, financing, and operation services in the US.

The company was acquired by ECP in 2015 and has since tripled its portfolio of operating renewable assets.

Supported by a portfolio spanning wind, solar, and energy storage facilities, Terra-Gen currently operates approximately 2.4 GW of renewable energy capacity and 5.1 GWh of energy storage across 32 sites in the US, primarily concentrated in California and Texas.

Key advantages of the Masdar-ECP deal

The acquisition positions Terra-Gen for continued growth, building upon the momentum achieved under ECP’s ownership.

Masdar’s extensive experience in funding, developing, and operating clean energy projects worldwide will support Terra-Gen’s expansion efforts, particularly in the US market.

Mohamed Jameel Al Ramahi, CEO of Masdar, expressed enthusiasm about the partnership, highlighting its potential to drive innovation and accelerate the energy transition. Al Ramahi emphasised the company’s commitment to the US energy sector and its ambition to build a global renewable energy portfolio of at least 100 GW capacity by 2030.

Philip Haddad, president and CEO of Masdar Americas, echoed Al Ramahi’s sentiments, emphasising Masdar’s readiness to collaborate with Igneo and Terra-Gen’s management team to support ongoing operations and facilitate the development of new renewable energy projects.

Jim Pagano, CEO of Terra-Gen, expressed confidence in the partnership, citing shared values and a mutual dedication to responsible energy development.

The transaction, expected to close by the end of the year, is subject to regulatory approvals and customary conditions.

Financial advisory services are being provided by Lazard and Guggenheim Securities for Terra-Gen, and BMO Capital Markets and JP Morgan for Masdar, with legal counsel from Latham & Watkins LLP, White & Case LLP, and Covington & Burling LLP.

#Masdar is excited to announce we have entered into a definitive agreement to acquire a 50 percent stake in Terra-Gen, one of the largest independent #RenewableEnergy power producers in the #UnitedStates.

This investment in Terra-Gen’s impressive energy portfolio expands… pic.twitter.com/wubpehkeMT

— Masdar (@Masdar) March 19, 2024

Masdar in the US: Fast facts

• The clean energy company first invested in the US energy market in 2019.
• The company’s US portfolio of utility-scale wind, solar and storage assets has a generating capacity of more than 1.4 GW.
• The US market will play an important role in supporting the company’s strategic plan to build a global renewable energy portfolio of at least 100 GW capacity by 2030.

In recent news, the UAE-based company completed its acquisition of a 49 per cent shareholding in the 3GW Dogger Bank South project – one of the world’s largest planned offshore wind farms. The planned £11 billion joint investment with RWE, a leading renewable energy company headquartered in Germany, is expected to provide a huge boost to the UK economy.