The deal is the first investment in the U.S. from KKR's Global Climate Strategy.
KKR, a top global investment company, has agreed to buy most of the shares in Avantus, a leading U.S. company that develops large solar and solar-plus-storage projects. After the deal is complete, KKR and current investor EIG will be the only owners of Avantus. Both investors are committed to supporting the next phase of Avantus' growth. They have also secured funding totaling over $1 billion for the company.
Established in 2009, Avantus helps with solar and energy storage projects from start to finish and owns a pipeline of 30 GW of solar and 94 GWh of battery storage. This is enough to provide clean, reliable power to 20 million people. Avantus has a strong presence and history of successful projects in the southwestern U.S. and California power markets, which are some of the best for development in the U.S. Since its start, Avantus has developed and sold 6.5 GW and 6.3 GWh of solar and storage projects.
Avantus is in a good position to benefit from trends supporting renewables in the U.S. According to BloombergNEF, the world needs to nearly triple its investment in energy transition to align with global climate goals. Most of this spending is expected to go towards renewable energy and power grids.
“For the U.S. to switch to renewable energy by 2050, there needs to be a big increase in renewable energy generation and grid electrification. Because of these trends, there is a huge opportunity for Avantus. The company's strong team, successful track record, and developed pipeline set it apart from other renewable energy companies.Charlie Gailliot, Partner and Co-Head of Global Climate Strategy at KKR, said, “We are excited to support Avantus in reaching its full potential.”
Cecilio Velasco, Managing Director of KKR’s Infrastructure team, added, “We are looking forward to partnering with Avantus and EIG, using KKR's resources and expertise to help the business grow. This is the start of a new era for the company, which will help further the transition to sustainable, clean energy solutions.”
Blair Thomas, EIG Chairman and CEO, said, “EIG has been happy to support Avantus since 2021, providing specific financial solutions that fit the company's needs and goals. Throughout the partnership, Avantus has kept its position as one of the leading and most innovative renewable energy developers in the U.S., contributing to the industry's rapid growth and expanding access to affordable, reliable, and clean energy. We are excited to keep working with the Avantus team and welcome KKR as we move forward with the next phases of Avantus’ growth and evolution.”
“Solar power is growing rapidly as a source of electricity in the U.S., and when combined with energy storage, it will be the foundation of a modern electric grid that is clean, dependable, and strong.” said Patrick Goff, Chief Financial Officer at Avantus. “KKR’s investment gives Avantus the financial support and expertise needed to carry out our ambitious portfolio and lead the energy transition in the Western United States. We are excited to start this new chapter with KKR and EIG and continue our company’s growth.”
After the transaction is completed, KKR will help Avantus establish a program for equity ownership to allow all employees to share in the company's benefits. This approach is based on the belief that involving employees is a crucial factor in building stronger companies. Since 2011, KKR portfolio companies have granted billions of dollars of total equity value to over 60,000 non-management employees across more than 40 companies.
With more than 15 years of experience in infrastructure investing, KKR has extensive knowledge in renewable energy and climate-related investments and has put in over $15 billion in this sector from its infrastructure platform only. KKR is financing the investment from its global climate strategy, which is committed to investing in large-scale solutions to support the shift to a low-carbon economy.
Jefferies LLC acted as the only financial advisor to KKR. KKR Capital Markets and Sumitomo Mitsui Banking Corporation (SMBC) acted as the main structuring agents and arrangers of a development financing facility for the Company. Scotiabank served as financial advisor to Avantus.
