Marubeni Closes Financing for $553 Million Acquisition of Mirant's Caribbean Power Assets
Milbank Represents Lenders in Structuring the Financing
NEW YORK, August 14, 2007 – Further expanding its portfolio of power assets in the Caribbean region, Marubeni Corporation of Japan (“Marubeni”) has closed on the financing for its $553 million acquisition of Mirant Corporation’s Caribbean power assets. The purchase was funded by Marubeni’s own equity and debt facilities provided by a group of international banks including Mizuho Corporate Bank, ABN AMRO, Calyon and ING Capital. Mizuho acted as financial advisor to Marubeni. The international law firm Milbank, Tweed, Hadley & McCloy LLP, led by partner David Impastato, represented the lenders in negotiating and structuring the financing.
Milbank’s Impastato stated, “Although M&A in the energy and power sectors has been active, the strength of the sponsor was a critical factor in completing this transaction at this time, given the current volatility and uncertainty in the credit markets.”
In addition to Mr. Impastato, the Milbank team representing the lenders included partner Daniel Bartfeld and associates Nick Bragg and Adrian Chiodo, all based in the firm’s New York office.
About the transaction:
One of Japan’s largest trading companies, Marubeni Corporation, through its wholly owned subsidiary Marubeni Caribbean Power Holdings, Inc. (“MPCH”), completed the $553 million purchase of the Mirant Company’s Caribbean power assets, Mirant Caribbean Holdings (“MCH”) on August 8, 2007. Marubeni was awarded the holdings in a competitive auction process held by U.S. independent power producer Mirant Corporation and signed the definitive sale and purchase agreement with Mirant International Investment on April 18, 2007. The payment consists of approximately $579 million in equity, the assumption of $350 million in debt and $153 million of power purchase obligations.
The acquisition was funded by Marubeni’s own equity and debt facilities provided by a group of banks led by Mizuho Corporate Bank and including ING, Calyon, ABN AMRO and National Commercial Bank Jamaica. Marubeni is seeking long-term take-out mezzanine financing from the Japan Bank for International Cooperation (“JBIC”).
The acquisition is part of Marubeni’s strategy of expanding its global power sector asset portfolio. This transaction enables Marubeni to expand its IPP and transmission and distribution presence through integrated utilities in the Caribbean region. Marubeni now owns controlling interests in two integrated utilities on Grand Bahama Island and Jamaica and interests in Curaçao’s national utility company and IPPs in Trinidad and Tobago and Curaçao. Total net generating capacity, including the acquisition, is 1,150 megawatts.
The sale completes Mirant’s divestiture program, leaving the company with operations solely in the United States. JP Morgan Securities Inc. acted as Mirant’s financial advisor on the sale.
About Milbank
Milbank, Tweed, Hadley & McCloy LLP is a preeminent global law firm that for more than 140 years has provided innovative legal solutions in many of the world’s largest, most complex, “first-ever” corporate transactions and litigation. Our transactional expertise includes capital markets, corporate finance and transactions, project finance, acquisition finance, and other major fields of law practice. Milbank litigation teams resolve disputes involving mergers and acquisitions, proxy battles, financings and securities offerings, intellectual property, white collar crime, and corporate restructurings, among others. Our clients range from prominent multinational financial, industrial and commercial enterprises to governments, institutions and individuals. The Firm is headquartered in New York with offices in Beijing, Frankfurt, Hong Kong, London, Los Angeles, Munich, Singapore, Tokyo, and Washington, DC.