By DARA BUTTERFIELD
Terra Firma, a private equity firm, is exploring the sale of its 68.6% stake in renewable energy company Infinis Energy at what may be a market-high turning point.
Terra Firma invested more than £50 million in Infinis 11 years ago and floated the company in November last year. Its stake is now worth near £450m.
A spokesperson said: “Given that Terra Firma owns a significant majority stake, we believe there is merit in exploring potential interest in the stake as a whole alongside other options, including the potential for market sell-downs,”
Infinis Energy said in a statement that it will work ‘constructively’ with Terra Firma to ensure that the interests of all shareholders are properly considered.
“There can be no certainty that a sale of any or all of Terra Firma’s shareholding in Infinis will take place nor as to the terms on which any such transaction may take place,” a spokesman said.
Infinis reported gross profit of £54 million in June from its 16 onshore wind farms in the year to March 31, up from £33 million the year before. However, gross profit from its landfill operations fell 7% to £107.6m.
Infinis Energy chairman Ian Marchant – formerly chief executive of Scottish & Southern Energy – said: “Since our IPO, Infinis has made good progress on its organic growth plans and has delivered on its commitments to investors, providing a combination of stable dividend income and earnings growth.
“We believe that Infinis continues to offer a compelling investment story.”
Reading between the lines, city observers indicated that Terra Firma fears that Infinis Energy’s stock may have reached a peak – so it would now be a very good time to chrystalise an 800% profit on its investment.