Capital Power has entered into an MOU with Apollo Funds to form an investment partnership to pursue the acquisition of merchant U.S. natural gas generation assets, with total potential committed equity of up to US$3 billion. The partnership combines Apollo Funds? capital strength with Capital Power?s operating and commercial expertise to accelerate Capital Power?s U.S. natural gas growth strategy and expand earnings.
The MOU contemplates an equity commitment of up to U.S.$2.25 billion from Apollo Funds and U.S.$750 million from Capital Power, with Capital Power electing a 25% to 50% working interest in each acquisition. The MOU contemplates a partnership with Capital Power operating acquired assets and receiving management and performance fees. Capital Power will create additional value by leveraging its operating platform to enhance asset performance and improve returns.
