BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
MARKET VIEW: For this quarter’s Emerging Energy Company Update, we’d like to Inside this issue: highlight the continued trend of Yieldco issuance (Yieldcos are publicly-traded equity Energy Trends p.1 vehicles which hold energy projects that are anticipated to generate significant steady Power Trends p.2 dividends over time due to their long-term high credit quality power purchase agreements, M&A p.4 in a tax-efficient manner [much like MLPs and REITs, for the midstream and real estate industries, respectively]), due to the confluence of a yield-oriented public market (on the Private Placements p.6 capital demand side), and the development of long-term steady cash flowing renewable Public Comps p.10
energy projects (on the issuance supply side). A case in the point is the first all-solar energy Yieldco, taken public by SunPower and First Solar earlier this month, called 8point3 Energy Partners (NASD: “CAFD”). We expect continued strong issuance of Yieldcos as renewables projects continue to come online and raise capital in the public markets at advantageous dividend yields.
ENERGY TRENDS MARKET OBSERVATIONS: ■ Crude Oil: □ U.S. production averaged 9.6 million bbl/d in May. Averages are expected to decline from June 2015 through early 2016 before growth resumes. 9.4 million bbl/d is projected for 2015 and 9.3 bbl/d is projected for 2016. □ Brent Crude oil prices increased by $5/bbl to $64/bbl in May. Contributing factors to this increase include continued signals of higher global oil demand growth, expectations for declining U.S. tight oil production in the coming months, and the growing risk of unplanned supply outages in the Middle East and North Africa. Brent Crude oil prices are projected to average $61/bbl in 2015 and $67/bbl in 2016, which is $3/bbl lower than last month’s estimate. ■ The Henry Hub average natural gas spot price was $2.85/MMBtu in May, an increase from $2.61/MMBtu in April. □ Henry Hub natural gas price averages are expected to rise moderately but remain under $4/MMBtu, as air- conditioning demand increases over the summer. Oil Prices vs. Gas Prices 6.00 120
5.50 110 5.00 100 4.50 90 4.00 80 3.50 70 3.00 2.50 60 50 2.00 1.50 40
Jul-11
Jul-12 Jul-13 Jul-14
Jan-11
Jan-12 Jan-13 Jan-14 Jan-15
Sep-11
Sep-12 Sep-13 Sep-14
Mar-11
Mar-12 Mar-13 Mar-14 Mar-15
Nov-11
May-11
Nov-12 Nov-13 Nov-14
May-13 May-14 May-15 May-12 Henry Hub Spot West Texas Intermediate Spot Average (dollars per million Btu) (dollars per barrel) ■ In May, U.S. regular gasoline retail price reached a monthly average of $2.72/gallon (gal), which is a 2015 high and an increase of $0.25/gal. Rising crude oil prices and isolated outages at West Coast and Midwest refineries contribute to higher prices. However, EIA predicts monthly average gasoline prices to decline from May’s level through the rest of the year, averaging $2.43/gal during the second half of 2015. Source: EIA JUNE 2015 1 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
ENERGY TRENDS ■ Shale Oil & Gas □ From June to July, Bakken, Eagle Ford, and Permian basins are expected to have the largest increase in production of oil per rig and Utica is expected to have the largest increase in production of natural gas per rig with 225 thousand cubic feet/day. □ The Permian and Utica basins were the only two basins that continued seeing increases in month-over-month production of barrels per day, seeing increases of three thousand and one thousand barrels per day, respectively. □ The Utica basins was the largest producers of natural gas, producing 42 million cubic feet per day month-over- month.
Oil (bbl/d) Production per Rig by Shale Play Natural Gas (Mcf/d) Production per Rig by Shale Play
700 9,000 8,000 600 7,000 500 6,000
400 5,000
300 4,000 3,000 200 2,000 100 1,000
0 0
POWER TRENDS
MARKET OBSERVATIONS: ■ In March, retail residential electricity prices increased to an average of 12.35 cents/kWh from 12.29 cents/kWh in February, also an increase from March 2014, when the average was 12.24 cents/kWh. □ The U.S. retail residential electricity price is projected to increase by 2.3% in 2015. □ EIA cites various reasons for the increase in retail electricity prices; Electric utilities purchase their power from wholesale markets, which nationally experienced higher prices last year. Other reasons include increased investment in transmission and distribution infrastructure, rising requirement to generate electricity from renewable energy sources, and utility investment in demand-side efficiency. ■ Coal □ EIA projects a 70 MMst decline in production for 2015 due to lower coal demand for domestic consumption and exports. □ Several producers have announced cuts in production in response to weak coal demand. Source: EIA JUNE 2015 2
BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
POWER TRENDS ■ Solar □ In Q1 2015, the U.S. installed 1,306 MW of solar PV, marking the sixth consecutive quarter in which the U.S. added more than 1 GW of PV installations. About 51% of all new electric-generating capacity in the U.S. came from solar in Q1 2015. PV installations are forecasted to reach 7.9 GW in 2015, up 27% over 2014. ■ Wind □ The U.S. installed 68 turbines, totaling 131 megawatts (MW) in Q1 2015. Texas installed the most wind capacity at 110 MW followed by Iowa (20MW), and New York (1MW). □ Developers estimated 1,200 MW of new wind power construction activity in Q1 2015. Total wind capacity construction amounted to more than 13,600 MW, marking the second highest construction level in U.S. history. The highest construction numbers were reported for 2Q 2014, which had 14,600 MW under construction. ■ Other Renewables □ EIA expects total renewables used for electricity will grow by 2.6% in 2015. Non-hydropower generation is expected to increase by 6.9%, while hydropower is expected to decrease by 1.9%. The hydropower generation decrease reflects the effects of the California drought, which are only somewhat offset by use of hydropower elsewhere.
U.S. Average Levelized Cost of Electricity (2012 $/MWh) for Plants Entering Service in 2019
Sources: EIA, American Wind Energy Association & Solar Energy Industries Association JUNE 2015 3 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
MERGERS AND ACQUISITIONS Middle Market Trends for Energy & Power Companies 200 182 180
160
140
120
97 97 100
80 Number ofDeals Number 60 60 50
40 35 33 32 29
20 15 8 4 0 Energy Utilities Energy Utilities M&A Private Placement Q4 2014 Q1 2015 Q2 2015 RECENT ENERGY TRANSACTIONS: ■ June 18th – Energy Fuels Inc. (TSX:EFR) acquired Uranerz Energy Corp. (AMEX:URZ) from Lockheed Martin Investment Management Company, Deans Knight Income Corporation, and Middlefield Capital Corporation for approximately CAD 180.0 million in stock. Uranerz Energy Corp, based in Casper, WY, engages in the acquisition, exploration, and extraction of uranium and mineral resources primarily found in the Powder River Basin area of Wyoming. ■ June 18th – Pacific Ethanol, Inc. (NasdaqCM:PEIX) acquired the remaining 4% stake in Pacific Ethanol Holding Co. LLC for $3.8 million in cash. Pacific Ethanol Holding Co., based in Sacramento, CA, is a holding company of several ethanol producing subsidiaries. ■ June 8th – Gravity Midstream Corpus Christi, LLC acquired Trigeant Ltd. from the Sargeant family for $100.0 million in cash. Trigeant, doing business as Trigeant Petroleum, Ltd., supplies fuel and asphalt products to the housing, transportation, and construction industries. The Company, based in Corpus Christi, TX, distributes its products through tank trucks, rail cars, barges, and ships. ■ June 5th– ARP Production Company, LLC acquired ATLS Production Company, LLC for $35.5 million in cash from New Atlas Holdings, LLC. ATLS Production Company, based in Pittsburgh, PA, explores and produces natural gas. ■ May 14th – Arc Logistics Partners LP (NYSE:ARCX) and GE Energy Financial Services entered into a Membership Interest Purchase Agreement to acquire Joilet Bulk, Barge & Rail LLC from Centerpoint Properties Trust for approximately $240.0 million in cash. Arc Logistics and GE Energy Financial Services will acquire a 60% and 40% stake in Joilet Bulk, Barge & Rail, respectively. The Company, based in Oak Brook, IL, primarily consists of a crude oil unloading terminal and a 4-mile crude oil pipeline known as the “Joilet Terminal.” ■ May 11th – JP Energy Partners LP (NYSE:JPEP) acquired Southern Propane Inc. for $14.9 million in cash. Southern Propane, based in La Porte, TX, provides propane products and services to the Gulf Coast. Sources: EIA, Cap IQ JUNE 2015 4 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
MERGERS AND ACQUISITIONS RECENT ENERGY TRANSACTIONS: ■ May 11th – JP Energy Partners LP (NYSE:JPEP) acquired Southern Propane Inc. for $14.9 million in cash. Southern Propane, based in La Porte, TX, provides propane products and services to the Gulf Coast. ■ May 6th – Cypress Energy Partners, L.P. (NYSE:CELP) acquired a 51% stake in Brown Integrity LLC for $11.2 million in cash, with the right to acquire the remaining 49%. Brown Integrity, based in Giddings, TX, provides pipeline hydrostatic testing and related services for the pipeline industry. ■ May 1st – 3 Rivers Capital, LLC acquired Rhodes Manufacturing Inc. for $3.0 million in cash. Rhodes Manufacturing, based in Somerset, OH, provides oil field services, including equipment sale, repair, and maintenance, to customers in West Virginia, Pennsylvania, Illinois, Indiana, Michigan, Kentucky, and Ohio. ■ April 17th – Royal Energy Resources, Inc. (OTCPK:ROYE) acquired Blaze Minerals, LLC for $26.6 million in stock from Wastech Inc. Blaze Minerals, based in Boise, ID, owns 40,976 acres of coal and coal bed methane across West Virginia. ■ April 3rd – Legend Oil and Gas, Ltd. (OTCPK:LOGL) acquired Black Diamond Energy Holdings, LLC from Sher Trucking, LLC, Albert Valentin, and Steve Wallace for $4.4 million in cash. Black Diamond Energy Holdings provides crude oil transportation services for information and processing centers in North Dakota. The Company, doing business as Maxxon Energy, is based in Killdeer, ND. ■ April 2nd – Oceaneering International, Inc. (NYSE:OII) acquired C & C Technologies, Inc. for approximately $230.0 million in cash. C & C Technologies, based in Lafayette, LA, provides surveying and mapping services for the land and offshore oil and gas industry, telecommunications industry, and government organizations in the US and internationally. ■ April 1st – Aspire Energy of Ohio LLC acquired Gatherco, Inc. for $58.2 million, comprised of $29.3 million in cash and the issuance of 0.6 million shares by Chesapeake Utilities, the parent company of Aspire Energy. Gatherco, based in Orrville, OH, owns and operates natural gas storage facilities in Ohio. ■ April 1st – Par Petroleum Corporation (OTCBB:PARR.E) acquired Mid Pac Petroleum, LLC for approximately $110.0 million in cash. Mid Pac Petroleum, based in Honolulu, HI, acquires, distributes, and markets petroleum products in the state of Hawaii. The Company also owns and operates petroleum terminals, trucking operations, and gas stations across the islands. ■ April 1st – TC Pipelines, LP (NYSE:TCP) has acquired an additional 30% stake in Gas Transmission Northwest LLC from TransCanada Corp. (TSX:TRP) for the net transaction value of approximately $350.0 million, consisting of $253.0 million in cash and $95.0 million of new Class B units. Gas Transmission Northwest LLC, doing business as TransCanada GTN System, owns and operates natural gas pipelines in the US. The Company, based in Houston, TX, offers its services to producers, marketers, electric and gas utilities, along with other end users. ■ March 31st – USIC Locating Services acquired Premier Utility Services, LLC from Willbros United States Holdings, Inc. for $5.1 million in cash. Premier Utility Services, based in Hauppauge, NY, provides underground utility locating and marking services, along with natural gas main and utility maintenance and inspection services.
Source: Cap IQ JUNE 2015 5 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
MERGERS AND ACQUISITIONS RECENT POWER TRANSACTIONS: ■ June 1st – CHS, Inc. acquired Patriot Holdings, LLC from REX American Resources Corporation (NYSE:REX) for approximately $200.0 million in cash. Patriot Holdings, based in Annawan, IL, builds, owns, and operates biodiesel plants. ■ April 17th – GE Energy Financial Services acquired a 49% stake in EGPNA Renewable Energy Partners LLC, a U.S. based power generation company from Enel Green Power North America, Inc. for $440.0 million in cash. The transaction involved a 49% stake in a 560 MW portfolio of wind, geothermal, hydropower, and solar generation assets as well a 200 MW wind farm, all operating in North America. ■ April 2nd – Crius Energy LLC acquired TriEagle Energy, LP for $22.2 million, consisting of $18.8 million in cash and $3.4 million in phantom unit rights. TriEagle Energy, doing business as TriEagle Energy Supply, operates as a retail energy provider that offers electricity supply solutions for commercial, industrial, and residential customers in Texas and Pennsylvania. The Company is based in The Woodlands, TX. ■ March 30th – Canadian Solar Inc. (NasdaqGS:CSIQ) acquired Recurrent Energy, LLC from Sharp US Holding Inc. for approximately $270.0 million in cash. Recurrent Energy, based in San Francisco, CA, operates a portfolio of solar development projects to meet the utility needs across California, Arizona, Ontario, and Spain. PRIVATE PLACEMENTS RECENT ENERGY PRIVATE PLACEMENT TRANSACTIONS: ■ June 15th – NextDecade, LLC raised approximately $85.0 million in funding from Halcyon Energy Investors LP, Valinor Management, LLC, and York Capital Management Global Advisors, LLC. As part of the transaction, the investors have been granted the options to invest the requisite Final Investment Decision equity sufficient to commence construction of the Rio Grande Liquefied Natural Gas project, a multi-billion dollar land-based export project and subsidiary of NextDecade. The Company, based in The Woodlands, TX, develops and manages land-based and floating liquefied natural gas projects, primarily in the state of Texas. ■ June 9th – Royal Energy Resources, Inc. (OTCPK:ROYE) raised $30.0 million through a securities purchase agreement for a private placement. The Company, based in Brooklyn, NY, is a development stage company that explores for mineral properties. ■ June 9th – Torchlight Energy Resources, Inc. (NASDAQ:TRCH) raised $9.8 million through a securities purchase agreement for a private placement of 98,000 preferred shares at $100 per share. Torchlight Energy Resources, based in Plano, TX, engages in the acquisition, exploration, exploitation, and development of oil and natural gas properties. ■ June 8th – Intensity Midstream LLC raised $300.0 million in equity from Quantum Energy Partners and other investors Joseph L. Griffin and Derek G. Gipson. Intensity Midstream, based in Tulsa, OK, acquires, develops, and operates midstream assets. ■ June 8th – Royal Energy Resources, Inc. (OTCPK:ROYE) raised $2.5 million through a purchase agreement to issue 1,000,000 common shares at $2.50 per share. Royal Energy Resources, based in Brooklyn, NY, explores for mineral properties and is a subsidiary of E-Starts Money Co.
■ May 28th – HII Technologies, Inc. (OTCPK:HIIT) raised approximately $3.1 million through securities purchase agreements with institutional and accredited investors for a private placement of 3,050 convertible preferred shares at $1,000 per share. The company also issued 3,812,500 warrants in the transaction. HII Technologies, based in Houston, TX, is an oilfield services company that focuses on commercializing technologies and providing services in frac water management, safety services, and portable power solutions for the exploration and production companies in the United States. Source: Cap IQ JUNE 2015 6 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
PRIVATE PLACEMENTS ■ May 26th – Denison Mines Corp (TSX:DML) raised CAD 15.0 million through a securities purchase agreement for a private placement of 12,000,000 flow-through common shares at CAD 1.25 per flow-through common share from Dundee Securities Ltd., Raymond James Ltd., Scotiabank Global Banking and Markets, and Cormark Securities Inc. Denison Mines, based in Toronto, Canada, engages in uranium mining and related activities in Canada, Mali, Namibia, Zambia, and Mongolia. ■ May 22th – Gener8 Maritime Inc. raised approximately $6.3 million through the issuance of common stock to 46 undisclosed investors. Gener8 Maritime, based in New York, NY, provides international seaborne crude oil transportation services. ■ May 18th – Shell Midstream Partners, L.P. (NYSE:SHLX) raised approximately $300.0 million through a common unit purchase agreement for a private placement of 7,692,308 common shares at $39 per share. Shell Midstream Partners, based in Houston, TX, owns, operates, develops, and acquires pipelines and other midstream assets in the United States and is a subsidiary of Shell Midstream LP Holdings LLC. ■ May 14th – Arc Logistics Partners LP (NYSE:ARCX) raised approximately $75.0 million through a private placement of 4,520,795 common units at $16.59 per unit from Kayne Anderson MLP Investment Company, Kayne Anderson Energy Development Company, Kayne Anderson Midstream/Energy Fund, Inc., Kayne Anderson Energy Total Return Fund, Inc., KA Fund Advisors, MTP Energy Master Fund Ltd., Oppenheimer SteelPath MLP Income Fund, among others. ARC Logistics Partners LP, based in New York, NY, engages in the terminalling, storage, throughput, and transloading of crude oil and petroleum products. ■ May 12th – Venture Global LNG, Inc. raised approximately $115.0 million in equity funding from 14 undisclosed investors. Venture Global LNG, based in Washington, DC, produces and exports liquefied natural gas. ■ May 11th – Joule Unlimited, Inc. raised $40.0 million in its venture debt round of funding led by Flagship Ventures among others. Joule Unlimited, based in Bedford, MA, develops a photosynthetic technology to produce drop-in fuels in a single-step conversion process using waste carbon dioxide feedstock and waste brackish water. ■ May 11th – Woodland Midstream, LLC raised $40.0 million from EIV Capital Fund II, LP. Woodland Midstream, based in The Woodlands, TX, acquires, develops, operates, and optimizes natural gas and natural gas liquids infrastructure throughout Texas and bordering states. ■ May 4th – Luxe Energy LLC raised $500.0 million in equity from NGP Natural Resources XI LP. Luxe Energy, based in Austin, TX, provides oil and gas drilling services. ■ April 30th – TETRA Technologies, Inc. (NYSE:TTI) issued a single senior secured note for gross proceeds of $50.0 million with undisclosed investors with a maturity date of April 1, 2017. The Company, based in The Woodlands, TX, is a diversified oil and gas services company operating in four divisions: fluids, production testing, compression, and offshore. ■ April 30th – ZaZa Energy Corporation (NasdaqCM:ZAZA) raised approximately $2.5 million through a securities purchase agreement for a private placement of 2,500 units of series A 5% convertible preferred stock at a price of $1,000 per unit with Alpha Capital AG. The Company, based in Houston, TX, focuses on the exploration and production of unconventional and conventional oil and gas assets in the United States. ■ April 15th – Sanchez Production Partners LP (AMEX:SPP) raised approximately $17.4 million through a private placement of 10,859,375 class A preferred units at $1.60 per unit from 11 investors, including individual investors such as Darren Schuringa, Sarah Schuringa, Grace Schuringa, William Hershey, and Michael Borges. The Company, based in Houston, TX, acquires, develops, and produces oil and natural gas properties in the United States.
Source: Cap IQ JUNE 2015 7 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
PRIVATE PLACEMENTS ■ April 15th – Sanchez Production Partners LP (AMEX:SPP) raised approximately $17.4 million through a private placement of 10,859,375 class A preferred units at $1.60 per unit from 11 investors, including individual investors such as Darren Schuringa, Sarah Schuringa, Grace Schuringa, William Hershey, and Michael Borges. The Company, based in Houston, TX, acquires, develops, and produces oil and natural gas properties in the United States. ■ April 14th – Next Wave Energy Partners, LP raised $500.0 million in equity funding from Energy Capital Partners among others. The Company, based in Houston, TX, is an independent energy company that focuses on the development, operation, acquisition, and expansion of midstream and downstream petrochemical and fuels assets. ■ April 10th – Meritage Midstream Services III, LP raised $100.0 million in equity funding from Riverstone Global Energy and Power Fund VI and Riverstone Energy Limited. Both funds are managed by Riverstone Holdings LLC. Meritage Midstream Services III, based in Denver, CO, offers midstream services to oil and gas producers. ■ April 9th – Nuevo Midstream Dos, LLC raised $400.0 million in equity funding from Encap Flatrock Midstream Fund III, a fund managed by EnCap Flatrock Midstream. The Company, based in Houston, TX, is a full-service midstream company, offering gathering, compression, processing, treating, transportation, and marketing services to crude oil and natural gas producers in the Delaware basin. ■ April 8th – Breitburn Energy Partners LP (NasdaqGS:BBEP) raised approximately $350.0 million through a private placement of 46,666,667 series B convertible units at $7.50 per unit from funds managed by EIG Global Energy Partners and Anchorage Capital Group, LLC. The Company, based in Los Angeles, CA, is an independent oil and gas partnership that acquires, exploits, and develops oil, natural gas liquids, and natural gas properties in the United States. ■ April 2nd – Legend Oil and Gas, Ltd. (OTCPK:LOGL) raised approximately $2.0 million through a securities purchase agreement for a private placement of original discount senior secured debentures with Hillair Capital Investments, LP. Legend Oil and Gas, based in Alpharetta, GA, acquires, explores, develops, and produces oil and gas properties in the United States. ■ April 1st – Alpha Natural Resources, Inc. (NYSE:ANR) issued private placement senior secured second lien notes for gross proceeds of $214.0 million with undisclosed qualified institutional buyers. Alpha Natural Resources, based in Bristol, VA, extracts, processes, and markets steam and metallurgical coal in Kentucky, Pennsylvania, Virginia, West Virginia, and Wyoming. ■ March 31st – Kinetics Energy Services, LLC raised $100.0 million in equity funding from Natural Gas Partners. Kinetics Energy Services, based in Houston, TX, acquires, integrates, and grows energy services and equipment companies by deploying capital to partner with small to mid-cap companies with the purpose of building an integrated production enhancement platform to serve the North American crude oil and natural gas exploration and production industry. ■ March 30th – Agrinatural Gas, LLC issued a single promissory note for gross proceeds of $3.5 million with Heron Lake BioEnergy, LLC. The Company, based in Heron Lake, MN, constructs, owns, and operates natural gas pipelines, and is a subsidiary of Heron Lake BioEnergy, LLC. ■ March 30th – American Midstream Partners, LP (NYSE:AMID) raised approximately $20.0 million through a private placement of 1,142,858 series A-2 convertible preferred units at $17.50 per unit from Magnolia Infrastructure Partners, LLC. The Company, based in Denver, CO, engages in gathering, treating, processing, and transporting natural gas, fractionating natural gas liquids, and storing specialty chemical products in the Gulf Coast and Southeast regions of the United States. ■ March 30th – Buffalo Coal Corp. (TSX:BUF) secured a $4.0 million bridge loan from Resource Capital Funds V L.P., a fund managed by Resource Capital Funds. Buffalo Coal Corp., based in Johannesburg, South Africa, engages in the acquisition, exploration, development, and operation of operating coal properties in Southern Africa. Source: Cap IQ JUNE 2015 8 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
PRIVATE PLACEMENTS RECENT POWER PRIVATE PLACEMENT TRANSACTIONS: ■ June 16th – Walker Ranch Energy, LLC raised approximately $4.6 million in equity from three undisclosed investors. The Company, based in Greenwood Village, CO, develops geothermal resources. ■ May 12th – NextEra Energy Partners, LP (NYSE:NEP) raised approximately $108.7 million through a securities purchase agreement for a private placement of 2,594,948 common units at $41.87 per unit from certain undisclosed eligible purchasers. The Company, based in Juno Beach, FL, acquires, owns, and operates contracted clean energy projects. ■ May 6th – TerraForm Global, Inc. raised $175.0 million through a purchase agreement to issue 175,000 class D units at $1,000 per unit from The Blackstone Group L.P., EverStream Opportunities Fund II, LLC, and Altai Capital Master Fund, Ltd which invested $50 million, $100 million, and $25 million, respectively. TerraForm Global, based in Bethesda, MD, owns and operates renewable energy generation assets. The Company serves utility, commercial, industrial, and governmental customers worldwide. ■ April 30th – Polaris Infrastructure Inc. (TSX:PIF) raised approximately CAD 74.4 million through a private placement of up to 18,598,500,000 subscription receipts at a price of CAD 0.004 per receipt from Brilliant Resources Inc. (TSXV:BLT). Polaris Infrastructure, based in Reno, NV, is a renewable energy company that acquires, explores, develops, and operates geothermal energy projects in North and South America.
Source: Cap IQ JUNE 2015 9 Emerging Energy Company Update Analysis of Comparable Publicly Traded Smid Cap Companies & Utilities (US$ in millions, except per share data) Market Statistics Operating Metrics Valuation Metrics Sales EBITDA Net Income EV / Sales EV / EBITDA Mkt Cap Enterprise LTM Company Ticker 6/18/15 Value LTM $ 2015 E LTM 2015 E LTM LTM 2015 E
Smid Cap Pipelines/MLP's: Chesapeake Granite Wash Trust CHKR $348.9 $347.7 $85.5 NA NA $47.8 NA 4.1x NA NA Calumet Specialty Products Partners LP CLMT $2,007.7 $3,654.0 $5,468.7 $319.4 $413.5 $23.5 $112.3 0.7x 11.4x 8.8x Delek Logistics Partners, LP DKL $1,123.6 $1,432.8 $781.2 $94.7 $112.0 $42.1 $76.8 1.8x 15.1x 12.8x Holly Energy Partners L.P HEP $2,072.4 $2,934.5 $335.3 $214.4 $230.5 $32.4 $88.9 8.8x 13.7x ` 12.7x Memorial Production Partners LP MEMP $1,276.0 $3,036.5 $470.0 $518.5 $402.9 ($6.0) $55.3 6.5x 5.9x 7.5x Midcoast Energy Partners, L.P. MEP $520.0 $3,795.6 $5,120.9 $280.9 $86.2 $16.2 ($22.6) 0.7x 13.5x NM Enduro Royalty Trust NDRO $145.0 $145.0 $20.5 NA $25.8 $12.4 $9.2 7.1x NA 5.6x Niska Gas Storage Partners LLC NKA $140.9 $908.7 $158.9 $28.1 $57.6 ($45.6) ($78.0) 5.7x NM 15.8x NuStar GP Holdings, LLC NSH $1,615.7 $1,640.5 $78.5 NA NA $45.7 $74.7 NM NA NA Summit Midstream Partners, LP SMLP $2,198.2 $3,005.2 $324.0 $165.5 $216.7 $17.7 $31.9 9.3x 18.2x 13.9x Southcross Energy Partners, L.P. SXE $662.4 $2,308.7 $809.7 $41.6 $88.7 ($22.9) ($30.3) 2.9x NM NM USA Compression Partners, LP USAC $951.2 $1,260.4 $236.3 $120.8 $143.5 $19.1 $26.8 5.3x 10.4x 8.8x Western Refining Logistics, LP WNRL $1,514.9 $2,377.0 $3,244.7 $95.2 $116.8 $50.0 $71.6 0.7x NM NM
High 9.3x 18.2x 15.8x Low 0.7x 5.9x 5.6x Mean 4.5x 12.6x 10.7x Median 4.7x 13.5x 10.8x
Generation: American DG Energy, Inc. ADGE $20.3 $34.2 $8.5 ($2.6) NA ($2.9) NA 4.0x NM NA Ameresco, Inc. AMRC $340.3 $509.5 $607.9 $40.9 $41.9 $6.1 $9.1 0.8x 12.4x 12.2x Capstone Turbine Corp. CPST $168.8 $150.0 $115.5 ($26.4) ($25.2) ($17.9) ($30.6) 1.3x NM NM Covanta Holding Corporation CVA $2,992.5 $5,209.5 $1,664.0 $401.0 $466.3 $37.8 $45.1 3.1x 13.0x 11.2x FuelCell Energy Inc. FCEL $319.8 $324.2 $167.9 ($20.7) ($17.2) ($20.9) ($32.0) 1.9x NM NM
High 4.0x 13.0x 12.2x Low 0.8x 12.4x 11.2x Mean 2.2x 12.7x 11.7x Median 1.9x 12.7x 11.7x
10 Emerging Energy Company Update Analysis of Comparable Publicly Traded Smid Cap Companies & Utilities (US$ in millions, except per share data) Market Statistics Operating Metrics Valuation Metrics Sales EBITDA Net Income EV / Sales EV / EBITDA Mkt Cap Enterprise LTM Company Ticker 6/18/15 Value LTM $ 2015 E LTM 2015 E LTM LTM 2015 E
Infrastructure: Badger Meter Inc. BMI $916.0 $983.5 $364.9 $60.7 $67.5 $26.8 $33.8 2.7x 16.2x 14.6x CECO Environmental Corp. CECE $304.1 $398.0 $287.0 $35.8 $43.3 $10.4 $24.0 1.4x 11.1x 9.2x CIRCOR International, Inc. CIR $937.1 $870.7 $796.1 $100.0 $77.1 $49.9 $40.7 1.1x 8.7x 11.3x Enphase Energy, Inc. ENPH $395.2 $368.1 $373.0 $4.9 $6.8 ($4.4) $9.7 1.0x NM NM ESCO Technologies Inc. ESE $986.2 $1,024.5 $531.4 $82.6 $92.3 $40.6 $46.4 1.9x 12.4x 11.1x Fuel Systems Solutions, Inc. FSYS $138.0 $73.5 $321.1 $6.8 $9.1 ($2.5) ($10.3) 0.2x 10.9x 8.0x Graham Corporation GHM $209.5 $149.3 $135.2 $25.6 $16.6 $14.7 $8.6 1.1x 5.8x 9.0x Global Power Equipment Group Inc. GLPW $133.9 $170.1 $538.5 $26.9 $31.2 $9.5 $9.4 0.3x 6.3x 5.5x Gorman-Rupp Co. GRC $754.0 $735.7 $424.1 $64.1 $70.0 $30.9 $35.9 1.7x 11.5x 10.5x MFRI, Inc. MFRI $46.2 $65.0 $173.0 ($2.4) NA ($4.2) NA 0.4x NM NA MTS Systems Corporation MTSC $1,058.0 $1,067.6 $575.1 $86.6 $92.3 $41.3 $46.7 1.9x 12.3x 11.6x PMFG, Inc. PMFG $138.0 $141.3 $160.6 ($1.6) ($1.1) ($4.3) ($5.2) 0.9x NM NM Powell Industries, Inc. POWL $442.9 $390.1 $636.4 $22.3 $50.2 $6.7 $22.1 0.6x 17.5x 7.8x Power Solutions International, Inc. PSIX $586.3 $682.1 $367.4 $33.2 $51.9 $17.3 $23.9 1.9x NM 13.1x
High 2.7x 17.5x 14.6x Low 0.2x 5.8x 5.5x Mean 1.2x 11.3x 10.1x Median 1.1x 11.3x 10.5x
Technology: Advanced Emissions Solutions, Inc. ADES $328.7 $346.7 $269.3 $9.2 $20.1 ($8.1) ($3.5) 1.3x NM 17.3x Advanced Energy Industries, Inc. AEIS $1,176.9 $1,021.0 $583.3 $81.9 $103.8 $38.4 $77.3 1.8x 12.5x 9.8x Energy Recovery, Inc. ERII $136.1 $107.4 $32.4 ($18.2) ($8.3) ($13.8) ($13.5) 3.3x NM NM Hydrogenics Corporation HYGS $105.5 $104.3 $45.0 ($2.1) ($4.3) ($2.6) ($5.6) 2.3x NM NM Lightbridge Corp. LTBR $22.2 $19.1 $1.2 NA NA ($2.8) NA NM NA NA Plug Power Inc. PLUG $447.5 $320.0 $68.1 ($36.5) ($28.8) ($14.5) ($36.4) 4.7x NM NM
High 4.7x 12.5x 17.3x Low 1.3x 12.5x 9.8x Mean 2.7x 12.5x 13.6x Median 2.3x 12.5x 13.6x
11 Emerging Energy Company Update Analysis of Comparable Publicly Traded Smid Cap Companies & Utilities (US$ in millions, except per share data) Market Statistics Operating Metrics Valuation Metrics Sales EBITDA Net Income EV / Sales EV / EBITDA Mkt Cap Enterprise LTM Company Ticker 6/18/15 Value LTM $ 2015 E LTM 2015 E LTM LTM 2015 E
Services: Broadwind Energy, Inc. BWEN $58.0 $62.7 $233.5 $4.9 $9.8 ($4.7) $0.7 0.3x 12.7x 6.4x Ecology & Environment, Inc. EEI $45.4 $44.7 $124.8 $6.3 NA $2.5 NA 0.4x 7.1x NA ENGlobal Corp. ENG $40.0 $34.3 $104.1 $7.2 NA $3.4 NA 0.3x 4.8x NA EnerNOC, Inc. ENOC $318.4 $306.1 $470.0 $35.6 ($17.9) ($4.1) ($49.5) 0.7x 8.6x NM Fuel-Tech, Inc. FTEK $55.8 $38.3 $75.5 $1.7 ($0.1) ($2.3) ($3.2) 0.5x NM NM Furmanite Corporation FRM $314.1 $350.0 $526.6 $33.4 $33.5 $11.4 $11.7 0.7x 10.5x 10.4x GSE Systems Inc. GVP $28.8 $17.2 $43.2 ($3.2) NA ($2.4) NA 0.4x NM NA Integrated Electrical Services, Inc. IESC $167.4 $130.4 $542.1 $14.6 NA $6.5 NA 0.2x 8.9x NA Mistras Group, Inc. MG $568.9 $701.6 $715.7 $63.5 $75.3 $17.4 $21.6 1.0x 11.1x 9.3x Matrix Service Company MTRX $509.0 $406.0 $1,323.1 $29.5 $48.7 $22.2 $24.0 0.3x 13.7x 8.3x PowerSecure International, Inc. POWR $345.9 $343.7 $283.4 $6.3 $25.4 ($2.5) $5.6 1.2x NM 13.5x TRC Companies Inc. TRR $318.9 $298.6 $394.5 $37.0 NA $17.2 NA 0.8x 8.1x NA
High 1.2x 13.7x 13.5x Low 0.2x 4.8x 6.4x Mean 0.6x 9.5x 9.6x Median 0.5x 8.9x 9.3x
Utility Scale Generation: DTE Energy Company DTE $13,652.4 $22,570.4 $11,355.0 $2,523.0 $2,609.5 $722.1 $832.1 2.0x 8.9x 8.6x NextEra Energy, Inc. NEE $45,242.9 $74,468.9 $17,451.0 $7,772.0 $7,401.4 $2,473.5 $2,512.4 4.3x 9.6x 10.1x NRG Energy, Inc. NRG $8,297.3 $29,006.3 $16,208.0 $3,033.0 $3,331.4 $147.6 $357.3 1.8x 9.6x 8.7x PG&E Corporation PCG $24,766.6 $40,780.6 $17,098.0 $4,444.0 $5,678.2 $801.3 $1,666.1 2.4x 9.2x 7.2x Public Service Enterprise Group Inc. PEG $20,856.7 $28,918.7 $10,798.0 $4,275.0 $4,054.9 $1,580.6 $1,476.4 2.7x 6.8x 7.1x Southern Company SO $39,182.4 $65,579.4 $18,006.0 $6,183.0 $6,838.2 $1,996.9 $2,570.1 3.6x 10.6x 9.6x Sempra Energy SRE $25,951.3 $40,614.3 $10,922.0 $3,187.0 $3,529.7 $993.0 $1,203.2 3.7x 12.7x 11.5x
High 4.3x 12.7x 11.5x Low 1.8x 6.8x 7.1x Mean 2.9x 9.6x 9.0x Median 2.7x 9.6x 8.7x
12 BRYANT PARK CAPITAL EMERGING ENERGY COMPANY UPDATE
MERGERS & ACQUISITIONS CAPITAL RAISING ADVISORY VALUATION
EXECUTIVES & SELECTED ENERGY TRANSACTIONS PRINCIPALS
Joel Magerman Managing Partner
Dan Avnir Managing Director
Volfi Mizrahi Managing Director
Dan Pickens Managing Director
John Poeta Managing Director
Edward Wu Managing Director
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212-798-8200 Founded in 1991, Bryant Park Capital (“BPC”) is a boutique investment bank which assists both public and PHILADELPHIA private companies in meeting their strategic objectives through Merger and Acquisition, Capital Raising and Eight Tower Bridge Strategic Advisory services. BPC's principals have an average of 20 years of experience as investment bankers, 161 Washington Street portfolio managers, entrepreneurs and operators in both private and public enterprises and have successfully Suite 310 completed over 385 M&A and capital raising assignments with an aggregate deal value of over $80 billion. Conshohocken, PA 19428 Securities are offered through Bryant Park Capital Securities, Inc., a licensed broker-dealer and FINRA and 484-586-8200 SIPC member firm Why Bryant Park? . Energy and Power Experience www.finra.org . We have extensive experience working with and advising energy and power driven www.sipc.org businesses . We understand the issues www.bryantparkcapital.com . We know how to analyze the company . We know how to position it properly . Access to Capital Sources . Extensive network of investors, lenders and buyers in the space . Proven Track Record . Have consistently brought incremental value to our clients The information in this newsletter is believed by Bryant Park Capital to be accurate and current and comes from reliable sources. However, unintentional errors may occur. With this being said the information is “as is” and without any representation or warranty of any kind, implied or expressed. Reproduction, retransmission, republication, or use of any of this document is prohibited. JUNE 2015 13