KKR buys Australian off-grid power specialist Zenith Energy

[SYDNEY] KKR has agreed to buy Australia’s Zenith Energy, a provider of off-grid power systems, from a group including Pacific Equity Partners Pty, Opseu Pension Trust and Foresight Group Holdings.

The investment firm did not provide a value for the deal, but said in a statement that it followed Zenith’s completion of a A$1.9 billion (S$1.6 billion) refinancing that provided the company with more than A$1 billion of capital to support the development of new projects.

KKR will make the investment from its Asia-Pacific Infrastructure Investors II Fund.

KKR paid A$1.7 billion at 12 times contracted earnings, according to two people close to the deal. KKR and Zenith declined to comment on the price.

Zenith has more than 710 megawatts of contracted capacity with resource-sector clients and urban microgrids, according to Tuesday’s statement. The Perth-based company is seeking to help Australia’s mining sector speed up efforts to reduce its emissions, chief executive officer Hamish Moffat said.

“Zenith has established itself as one of the clear leaders in deploying and managing hybrid power solutions in Australia, a priority market for KKR in Asia Pacific,” said Andrew Jennings, KKR’s managing director and head of Australia & New Zealand Infrastructure. “Zenith’s position at the forefront of the energy transition, coupled with its long-term relationships with strategic, high-quality counterparties, make it an ideal investment for our Asia-Pacific infrastructure platform.”

The transaction is expected to close late this year. BLOOMBERG