OMERS acquisition of Navisun from Ares adds DG exposure following utility-scale deal with Leeward
OMERS Infrastructure struck a deal to acquire distributed generation solar power producer Navisun LLC from funds managed by Ares Management Corporation on November 2, according to a press release.
The deal will add to OMERS Infrastructure’s portfolio of renewable generation assets, which also includes Leeward Renewable Energy and a 19.4% stake in India-based independent power producer Azure Power Global Limited - a deal that happened earlier this year.
“OMERS investment in Navisun adds diversification and offers new opportunities for OMERS in the U.S. renewables market,” said Annesley Wallace, Global Head, OMERS Infrastructure in an emailed statement to NPM. “With Texas-based Leeward Renewable Energy giving OMERS exposure to utility-scale renewables generation, and Navisun giving us a presence in distributed renewables generation, we have two well-positioned platforms to help us further invest in the energy transition theme,” she added.
The transaction is expected to close 1Q22, subject to regulatory requirements.
The Hingham, Massachusetts-based Navisun acquires, co-develops, constructs, finances, owns and operates distributed and small utility-scale solar and storage projects throughout the United States. Navisun targets solar power and storage projects ranging from under 1 MW to 30 MW.
The company’s many competitive advantages include deep expertise in all aspects of the solar and storage value chain such as development, engineering, construction, finance, operations, and asset management.
Scotia Capital ran the process on behalf of Ares, said a source familiar with the situation.
CohnReznick Capital Markets Securities LLC served as financial advisor to OMERS. Shearman & Sterling LLP was OMERS legal advisor.
The terms of the deal were not disclosed.
Navisun is among many smaller-to-middle market sized developers that could become attractive targets as infrastructure funds and others cast a wider net to invest in renewable developers beyond the largest players in the space, according to comments made by panelists at the Platts US Power Conference held last month.
Navisun was founded in January 2017 by John Malloy and Doug Johnsen, former executives at Greenwood Energy, in partnership with Ares Capital Corporation (ARCC), a publicly-listed business development corporation (BDC), which is externally managed by Ares Management Corporation.
ARCC held USD 108m in first lien paid-in-kind (PIK) debt due in 2023 on Navisun marked at PAR and USD 13.6m in Series A preferred units marked above PAR as of 30 September, according to SEC filings.
Ares, Navisun and Scotia did not return calls seeking comment. *
*This story was originally published exclusively for NPM subscribers earlier this month.