ContourGlobal to acquire two cogeneration energy plants from Alpek for $724m

ContourGlobal plc reached agreement with Alpek S.A.B. de C.V, to acquire Alpek's portfolio of two natural gas-fired combined heat and power plants, together with development rights and permits for a third plant, for $724m in cash. An additional payment at closing estimated at $77m represents the Value Added Tax assessed for the transaction and is expected to be refunded in full within 12 months of closing. The two CHP plants will provide electricity and steam under long-term contracts to subsidiaries of Alfa S.A.B. de C.V, a leading Mexican industrial conglomerate, and other commercial and industrial customers. The CHP plants are located on sites adjacent to, and interconnected with, Alpek's industrial facilities and have a gross installed capacity of 518MW. Additionally, ContourGlobal will be acquiring the development rights and permits for a third adjacent plant with a planned capacity of 414MW. Joseph C. Brandt, President and CEO of ContourGlobal commented: "This accretive transaction fits squarely into our strategic and financial approach to acquisitions. It was highlighted during our IPO and reflects our commitment to pursue high quality growth through operationally led strategic acquisitions and to double adjusted EBITDA without issuing new equity within five years of our listing. We are closer to achieving this objective with this acquisition, which we expect to add approximately $110m to our adjusted EBITDA in the first full year of operations."