Global buyout major Apollo has reached a $320m deal with energy investor EnCap to acquire a 50% stake in Broad Reach, AltAssets can reveal. The deal values the business at more than $600m.
Apollo, together with other existing shareholders, have committed a up to $400m additional equity investment to fund the company’s expansion and growth pipeline.
Broad Reach applies energy storage technology and power market analytics to improve the performance of renewable and power generation facilities. It has more than 1.4GW hours of storage assets in operation and controls a 21GW portfolio of utility-scale wind, solar and energy storage power projects in the US.
Geoff Strong, senior partner and co-head of infrastructure and natural resources at Apollo, said, “At Apollo we have been highly active in the energy transition, and we are thrilled to join EnCap in this investment in Broad Reach, which in our view is the premier energy storage leader in the US.
“Broad Reach has a scaled, high-performing platform that is well positioned for strong continued growth, particularly as the shift to more intermittent clean energy increases volatility and drives demand for energy storage.”
Apollo had been running a energy efficiency, renewable push over the recent years. It made a $150m equity commitment in August to FlexGen Power Systems, an integration services and software tech provider for energy storage solutions.
Over the past two years, it had also invested in offshore wind developer US Wind, entered into a new venture with Johnson Controls to provide sustainability and energy efficiency services, formed a joint venture to accelerate the growth of renewables royalties company Great Bay Renewables and invested in electric-driven gas compression company TOPS, among other energy efficiency deals.
Over the summer, the firm was reportedly raising $500m for a new fund dedicated to backing special purpose acquisition companies.
It raised more than $2.3bn for the final close of its latest Accord fund targeting dislocated credit deals.
The Accord Fund IV raise comes less than a year after Apollo collected $1.75bn for Accord Fund III in a matter of weeks, driven by LP desire to profit from the widespread market volatility caused by the Covid crisis.
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