Friday 9 December 2016

Bord Gáis owner lining up bid to buy Viridian

Published 15/01/2016 | 02:30

Centrica. Photo credit: Scott Barbour/Getty Images
Centrica. Photo credit: Scott Barbour/Getty Images

Bord Gáis's UK-based owner Centrica is lining up a bid for Northern Ireland's biggest energy supplier.

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Centrica is the largest energy supplier to UK homes, and is understood to be working on a joint bid for Belfast-based Viridian, alongside other investors, sources said.

Australian financial services firm AMP Ltd is also among parties lining up an offer, it is understood.

In September the Irish Independent reported that Arcapita was looking to sell the Irish business for at least €1bn.

Arcapita, which is being advised by Evercore Partners in London, had called for first round bids to be made by the end of business today. In Northern Ireland Viridian owns Power NI, which supplies electricity to about 610,000 homes and businesses.

In the Republic, Viridian owns Energia, which supplies electricity to the domestic and commercial markets and also owns and operates the Huntstown Power Station in Dublin.

Viridian's Bahrain-based owner, Arcapita, filed for Chapter 11 protection in the US in 2012 after talks with creditors over a syndicated loan broke down, and exited bankruptcy a year later after securing finance from Goldman Sachs Group Inc.

Centrica entered the Irish energy market in 2014, buying State-owned energy firm Bord Gáis Energy for €1.1bn along with a consortium that also included Brookfield Renewable Energy Partners LP and iCON Infrastructure.

While Centrica led the bid, it only bought €210m of the assets, made up of BGE's gas and electricity supply business, serving 900,000 customers, and the gas fired Whitegate power station.

The biggest element of the Bord Gáis deal was Canadian infrastructure investor Brookfield Renewable Energy Partners' acquisition of 17 wind farms.

A similar deal for Viridian could well see its energy production assets also being split off from the retail supply business.

Brookfield, which bought BGE's wind energy assets, has also been assessing Viridian's wind business, according to one person familiar with the matter.

Spokesmen for Arcapita, Centrica and Brookfield declined to comment. Officials at AMP didn't return a call or email to the company's London office seeking comment.

The ESB, the biggest energy producer and supplier on the island of Ireland, is seen as unlikely to bid for any Viridian assets given the likely competition issues a deal would throw up.

On a group basis, Viridian generated revenue of £1.46bn (€1.9bn) in its last financial year, compared to £1.6bn a year earlier. Operating profit was unchanged at £77.1m.

Viridian was tipped to be floated on the stock markets when Arcapita's plan to exit the business first emerged. (Additional reporting Bloomberg)

Irish Independent

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