Victor Li, co-chairman of Husky Energy Inc and son of one of Asia’s richest men, has agreed to acquire Reliance Home Comfort LP, a Canadian provider of heating and cooling systems, from U.S. private investment firm Alinda Capital Partners for $2.8 billion (US$2.10 billion), Reliance said on Friday.
Li’s acquisition comes through his CKP Canada vehicle, a unit of Hong Kong property developer Cheung Kong Property Holdings Ltd. Li is the heir to Hong Kong billionaire and property tycoon Li Ka-shing.
Barclays was exclusive adviser to Li. Alinda’s advisers were Goldman Sachs and Canadian Imperial Bank of Commerce. Torys provided Alinda with legal advice.
Toronto-based Reliance provides heating, cooling and water services to both consumers and businesses. By renting water heaters and other equipment, the company has a recurring revenue stream that gives it the qualities of an infrastructure play.
Several U.S. private equity firms also looked at the asset, according to people familiar with the situation, who spoke on condition of anonymity because the discussions were private.
Reliance has expanded in recent years. It acquired National Energy Corp, a provider of water heater and HVAC home services, for $505 million from Just Energy Group Inc in 2014.
Along with its own SmartAir line, Reliance offers furnaces and air conditioners from United Technologies Corp‘s Carrier, as well as the Goodman and Amana brands. Other players in the space include Canadian publicly listed companies Enercare Inc and Just Energy Group Inc.
Alinda is one the largest U.S. managers of pension funds for infrastructure investments. It has about US$10 billion of assets under management. It has invested across the United States, Canada, the United Kingdom and Germany, according to its website. Alinda’s current investments include London’s Heathrow Airport and Polish broadcast infrastructure business Emitel.
Update: Reliance entered Alinda’s portfolio in 2007, when the investor acquired UE Waterheater Income Fund for about $1.74 billion.
By John Tilak
(Editing by Matthew Lewis)
(This story has been edited by Kirk Falconer, editor of PE Hub Canada)
Photo courtesy of Reliance Home Comfort LP