Kohlberg Kravis Roberts to acquire Calvin Capital

06 December 2016 - 12:00 am UTC

Infracapital has agreed to sell 100% of Calvin Capital, its UK smart metering business, to US private equity investor Kohlberg Kravis Roberts for an undisclosed sum.

Infracapital, the infrastructure equity investment arm of M&G Investments, announced the move on Tuesday (6 December) in a statement. 

KKR’s emergence as preferred bidder to acquire the asset follows the submission on 21 October of first round bids by a number of suitors.

Goldman Sachs Infrastructure Partners (GSIP) is understood to have submitted a bid as part of a consortium, as had Berkshire Hathaway-owned UK utility Northern Power Grid, as previously reported. 

Other investors also said to have been eyeing the asset include CKI, Wren House, CPPIB, Equitix and SSE, as reported.

The deal is expected to close by the end of January 2017, Infracapital said. The transaction is structured as an all-equity deal, according to one source.

The buyer and seller would not discuss financing details. Sources had previously told InfraNews that Calvin Capital is worth between GBP 400m and GBP 500m excluding debt. 

The seller of Calvin Capital is Infracapital Partners LP, Infracapital’s first fund, which is managed by M&G Investment Management. The fund matures in August 2017, meaning that it had to sell the asset this year.

Infracapital Partners I acquired Calvin Capital in 2007 for GBP 149.2m. At the end of last year, Infracapital Partners II invested a further GBP 290m in the business, a deal linked to a GBP 1bn roll-out of seven million smart meters in the UK.

Citi (financial) and Hogan Lovells (legal) are advising Infracapital on the sale.

DC Advisory is advising KKR.