3i is boosting its investment in the UK’s largest landfill-to-electricity business Infinis by £125m to help fund acquisition of Alkane Energy
The UK’s largest generator of electricity from landfill gas, Infinis, is set to get a £125m boost to help fund a new acquisition.
3i Infrastructure, its listed private equity owner, will provide the cash as Infinis grabs Nottinghamshire-base Alkane Energy, a power generator which turns coal mine methane into electricity.
3i bought Infinis from Guy Hands’ Terra Firma in 2016 for £185m plus debt. Under Hands’ ownership, the group had spanned several renewable energy sources such as wind power, but the buyout boss split up the group after then-chancellor George Osborne introduced a series of levies on green energy in the 2015 Budget.
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“The combination of Alkane with Infinis is compelling, adding an attractive portfolio of generating assets with potential to grow over time, and diversifying Infinis’s revenues,” said Phil White, managing partner and head of infrastructure at 3i Investments.
Alkane, founded in 1994, operates the largest portfolio of coal mine methane sites in the UK. It captures methane – a greenhouse gas which would otherwise be released into the atmosphere – from abandoned and mothballed mines and turns this into power.
As at December 2017, Alkane had 160 megawatts of installed generating capacity across 32 sites in the UK. According to Ofgem, the energy regulator, one megawatt can keep 2,000 average homes in power for an hour.
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