Terra Firma to sell Phoenix Natural Gas to Hastings

Terra Firma has agreed to sell 100% of Carmel Capital II S.à.r.l., including subsidiary Phoenix Natural Gas Ltd. The buyer is Hastings Funds Management. Financial terms weren’t announced. Phoenix is Northern Ireland’s largest natural gas distribution and energy services company. Bloomberg News has reported the deal could be worth about 700 million pounds ($1.06 billion).


MELBOURNE, Australia–(BUSINESS WIRE)–Terra Firma has reached an agreement to sell 100% of Carmel Capital II S.à.r.l., including its wholly owned subsidiary Phoenix Natural Gas Limited (“Phoenix”), to Hastings’ managed fund Utilities Trust of Australia (“UTA”) and The Royal Bank of Scotland Group Pension Fund (“RBSGPF”), for which Hastings manages an unlisted infrastructure mandate.

Phoenix is Northern Ireland’s largest natural gas distribution and energy services company. Phoenix Natural Gas owns and operates the Greater Belfast natural gas network and is responsible for making gas available to around half the population of Northern Ireland.
Guy Hands, Chairman of Terra Firma, said:
“We are delighted to realise our investment in Phoenix. The success of this investment highlights the expertise of Terra Firma in transforming asset-backed businesses in essential industries. Since we bought the company in 2005, Phoenix has doubled in size and has increased gas availability to 300,000 properties, of which some 165,000 have already connected to the network. Phoenix is well positioned for future growth, and we are confident that under Hastings’ ownership it will continue to thrive.”
Andrew Day, Hastings Chief Executive, said:
“The outlook for the use of natural gas as a clean and efficient fuel source in Northern Ireland is compelling. Phoenix continues to play an important role in bringing gas to consumers in the Greater Belfast area and we are excited to support this.”
He added: “The successful transaction is a direct result of Hastings’ global operating model and reflects our increased commitment to growing our capabilities in different regions for the benefit of our investors.”
Peter Dixon, Group Chief Executive, Phoenix Energy Holdings, said:
“Phoenix Natural Gas, our core business, is responsible for operating and extending our gas distribution network as well as developing and supporting the wider local natural gas industry in Northern Ireland. Over the past eight years, under Terra Firma’s ownership, Phoenix has invested over £100 million locally. The key ambition for Phoenix in the years ahead is to continue to grow significantly the distribution business, and attracting an investor such as Hastings into the local Northern Ireland economy will help us to meet this ambition.
“Hastings sees great opportunities for growth here in Northern Ireland and in particular was attracted by Phoenix’s ambitions to continue to increase gas availability in its existing licence area, as well as to target opportunities for growth in areas that are new to Phoenix.”
About Hastings
Hastings is a specialist fund manager of infrastructure assets dedicated to delivering reliable and consistent investment returns to a wide range of institutional investors. Hastings’ stringent investment philosophy focuses on providing long-term value for investors through a disciplined and cautious approach.
Established in 1994, Hastings was one of Australia’s first infrastructure fund managers. As at 30 June 2013, Hastings had A$7.2 billion in funds under management, with an asset portfolio predominantly comprising utilities, airports, toll roads and seaports in Australia, UK, Europe and USA.
About Phoenix
Phoenix Natural Gas formed the local natural gas industry in 1996, is one of the largest private sector investors in Northern Ireland, connecting over 8,000 homes and businesses to its natural gas network every year. The Phoenix natural gas licence area includes: Belfast, Lisburn, Carryduff, Newtownards, Comber, Bangor, Donaghadee, Millisle, Groomsport, Holywood, Newtownabbey, Carrickfergus and Larne.
About Terra Firma
Terra Firma is a leading private equity firm which specialises in buy-outs of large, asset-rich and complex businesses. Terra Firma creates values for those businesses and its investors by delivering improved strategy, operations and management. Since being set up in 1994, Terra Firma has invested over €16 billion of equity and completed transactions with an aggregate enterprise value of €45 billion.
The information contained in this communication is for informational purposes only and does not constitute an offer of, or to issue or arrange to issue, investments. The information contained in this communication is not investment advice nor does it constitute a personal recommendation to any person to whom it is made or directed. This communication is not intended as an offer or solicitation of, or recommendation to any person to invest in any Hastings fund. Whilst Hastings UK believes that the material contained in this communication is in all material respects true, fair and not misleading, no person should rely on it without independently verifying such material. Hastings UK, its directors, officers, employees and agents accept no liability whatsoever for any loss or damage howsoever caused, and whether or not due to Hastings UK’s negligence, except that this disclaimer does not extend to personal injury or death caused by negligence. This communication is directed at, eligible counterparties, professional clients and not retail clients (as defined in the rules of the Financial Services Authority) and persons who qualify as high net worth companies, unincorporated associations etc within the meaning of article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the “FPO”) [and article 22 of the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes)(Exemptions) Order 2001 (as amended) (the “CIS Order”) or who otherwise fall within an exemption from section 21 of the Financial Services and Markets Act 2000 pursuant to the FPO and from section 238 of the Financial Services and Markets Act 2000 pursuant to the CIS Order (in each case an “Exempt Person”). This communication may not be copied reproduced, disclosed or distributed to any other person except to another Exempt Person. The information contained in this communication is highly confidential and the property of Hastings UK and its affiliates. This communication is intended solely for the use of the persons to whom it has been delivered. Hastings UK is a wholly owned subsidiary of Hastings Management Pty Ltd (Hastings). Hastings operates in Australia through Hastings Funds Management Limited, holder of Australian Financial Services licence number 238 309. Hastings is a subsidiary of Westpac Banking Corporation (‘Westpac’). This communication has been prepared by Hastings Funds Management (UK) Limited (“Hastings UK”), a company registered in England and Wales and authorised and regulated by the Financial Services Authority, FRN 459816.