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March 26, 2008 |
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ALLCO FINANCE: Hires Marathon Capital for Energy Business Sale Allco Finance Group has retained Marathon Capital, LLC to assist it in the sale of its global wind energy business, Allco Wind Energy. AWE owns, or has rights to, a portfolio of investments in wind energy projects totaling approximately 4,000 MW in the United States, Europe and Australasia and features one of the largest wind development projects in the world -- the 3,100 MW Tehachapi project in California. AWE can also boast a well established and recognized global team of 23 wind energy specialist staff with over 150 years of experience in originating, developing, constructing, financing and operating wind and energy projects. Commenting on AWE, Ted Brandt, chief executive officer of Marathon stated, "Allco Wind Energy's gigantic Tehachapi project in California is the Crown Jewel of the US and global wind industry. It is the largest single location development project available in the world today and is supported by a very conducive wind energy environment and the largest utility-backed wind energy Power Purchase Agreement in the US market. The successful acquirer of this vast and highly attractive project will gain an unrivalled renewables platform in California, the U.S.'s largest and most energy hungry state." Key parts of the AWE portfolio, which may be sold as a single global business or in three separate geographic parts, include: (1) USA/Tehachapi: Covering 50 square miles in predominately Kern County, California a proven wind area in the US, the Tehachapi project creates a unique opportunity for a potential buyer to gain immediate scale in the US wind energy market. This project has a multi-year development and power purchase agreement (PPA) with Southern California Edison for 1,550 MW, (this agreement is the largest ever signed, providing power for over a million households) and a 24 MW installed and soon to be operating "behind the meter" contract with California Portland Cement Company. Further, beyond the initial land required for the PPA, the project company has additionally secured both the key land agreements and the transmission queue positions for the additional expansion capacity. These critical development milestones are particularly valuable in a US state that has high renewable energy standards, scarcity of appropriate land for wind energy and where investors place a very high value on PPAs. (2) Australasia: Approximately 1,600 MW involving 8 projects in Australia of 1,114MW and 6 projects in New Zealand for 538 MW (3) Europe: Approximately 100MW created by 6 operational wind farms located in Germany and 4 wind projects in construction and pre-construction (2 in France and 2 in Germany) Commenting on the potential sale Steen Stavnsbo, chief executive officer & managing director of Allco Wind Energy, said, "This is a unique opportunity to secure a significant strategic stake in the all important Californian energy market, as well as a network and international portfolio in a sector whose long term growth is supported by the increasing global demand for clean energy. In addition, the AWE team's exceptional knowledge of the industry puts it at the forefront of this growth opportunity as it creates a high quality pipeline of future deals and advanced procurement of equipment." About Allco Finance Allco Finance Group Ltd. is an integrated global financial services business, specializing in asset origination, funds creation and funds management. The Company is a fund manager of alternative assets in its core asset classes, which include aviation, rail, shipping, infrastructure, property, private equity and financial assets. Its primary focus is on commercial property, predominately completed office buildings and select development opportunities. It also purchases new and existing commercial passenger and cargo aircraft for lease to commercial airlines. In March 2007, Allco HIT Limited acquired Momentum Investment Finance Pty Limited, Allco Financial Services and International Mezzanine Funds Management (Australia) Limited. The Company is a vendor of Momentum Investment Finance Pty Limited and Allco Financial Services. In July 2007, it acquired Allco Equity Partners Ltd. In December 2007, it completed the acquisition of the remaining 79.6% stake of Rubicon Holdings (Aust) Limited. Published reports said that Allco is in the brink of insolvency and is currently negotiating a new business plan that will avoid puttings its operations in the hands of administrators. According to The Age, Allco board is faced with four problems: -- Meeting a fast-approaching deadline to refinance at least US$250 million in debt. -- Ensuring there is enough cash to cover its continuing, and much larger, loan commitments. -- Renegotiating or pulling out of a recently announced joint venture deal to buy US$1.7 billion of US power stations, of which Allco would fund half by debt and equity. -- Signing the company's accounts, for which they will be personally liable, that would allow the suspension on Allco's beleaguered shares to be lifted. |
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