Macquarie Infrastructure Co. (NYSE: MIC) announced April 8 that on April 1 it completed the previously announced acquisition of the Bayonne Energy Center in New Jersey.
The $720 million (enterprise value) transaction adds 512 MW of gas-fired electricity generating capacity to MIC’s Contracted Power and Energy segment. MIC said it expects to provide additional commentary on the impact of the acquisition along with its financial report for the first quarter. The company will publish its results for the first quarter of 2015 after the close of the markets on May 4.
Macquarie Infrastructure owns, operates and invests in a diversified group of infrastructure businesses providing basic services to customers in the United States. Its businesses consist of a bulk liquid terminals business, International-Matex Tank Terminals, an airport services business, Atlantic Aviation, a gas processing and distribution business, Hawaii Gas, and several entities comprising a Contracted Power and Energy segment. MIC is managed by a wholly-owned subsidiary of the Macquarie Group Ltd.
On March 16, the Federal Energy Regulatory Commission approved this sale. On Feb. 12, Bayonne Energy Center LLC (BEC) and Zone J Tolling Co. LLC had requested authorization for a transaction that will result from the transfer of 100% of the indirect equity ownership interests in these applicants from PER Development Holdings LLC, a wholly-owned subsidiary of ArcLight Energy Partners Fund III LP, to a Macquarie affiliate.
BEC owns and operates the Bayonne Energy Center, a 512-MW natural gas-fired plant located in Bayonne, New Jersey. While the facility is located within the footprint of PJM Interconnection, it is not interconnected to the PJM grid. It is solely interconnected to the transmission system owned by Consolidated Edison Co. of New York and operated by the New York Independent System Operator (NYISO) via a 6.75-mile, 345-kV submarine cable that is a dedicated generator lead line for the facility.
The entire output of the facility has been sold pursuant to long-term tolling agreements. Direct Energy Business Marketing LLC, an unaffiliated third party, is the counterparty to two long-term tolling agreements that convey control over 320 MW from the facility to Direct Energy. The remaining capacity of the facility is sold under two long-term tolling agreements with Zone J Tolling.