Terra Firma exits RTR in €1.3bn SBO

Alessia Argentieri
26 July 2018

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Terra Firma has sold solar energy platform RTR Rete Rinnovabile (RTR) for €1.3bn to Italian infrastructure GP Fondi italiani per le infrastrutture (F2i).

The enterprise value equates to 9.5x the company's 2017 EBITDA of €137m.

Unquote understands that Terra Firma made a 1.6x return on the investment and the deal included around €700m of debt provided by a pool of banks composed of BNP, Calyon, ING, Intesa Sanpaolo, SocGen and UBI.

F2i deployed capital from its third fund to support the investment. The vehicle reached a €3.14bn first close in December 2017 and is expected to raise €3.3bn by the end of 2018.

The sale ends a seven-year holding period for Terra Firma, which acquired RTR from Italian national high-voltage electricity grid operator Terna for €641m. The deal was structured with around one-third equity and two-thirds leverage.

Terra Firma subsequently deployed additional capital to invest in the company, for a total of €755m.

RTR was acquired by the GP via its €5.4bn third fund, which has recently secured a 12-month extension to facilitate the sale of its remaining portfolio companies.

Under Terra Firma's management, RTR completed a series of bolt-on acquisitions and more than doubled its production capacity, from 144MW from 32 sites in 2011 to 334MW across 134 production sites today. The company grew from a small portfolio of solar energy assets with a turnover of less than €10m and negative EBITDA to one of the largest solar energy companies in Italy, which generated EBITDA of €137m from revenues of €160m in 2017.

Company
Headquartered in Rome, RTR is a solar photovoltaic power generator with a capacity of 334MW and 134 production sites. The business employs 30 people and serves 150,000 homes in Italy. The company generated EBITDA of €137m from revenues of €160m in 2017.

People
Terra Firma - Andrew Geczy (chief executive).
F2i - Renato Ravanelli (CEO).
RTR Rete Rinnovabile - Ingmar Wilhelm (chair, CEO).

Advisers
Seller - Cantor Fitzgerald (financial due diligence); Jefferies (corporate finance); JP Morgan (corporate finance); Gianni Origoni Grippo Cappelli & Partners (legal).