Quinbrook, a specialist investment manager focused exclusively on delivering the infrastructure needed for the energy transition, today announced the sale of its Flexitricity energy optimisation business to Drax Smart Generation HoldCo Limited, a subsidiary of Drax Group plc ("Drax"). The agreed sale price generates expected total sale proceeds of c. £42 million which represents an enterprise valuation of £36 million plus an estimated net working capital and cash adjustment of c. £6 million, which is subject to customary closing adjustments.
Quinbrook first acquired the next-generation flexible energy platform in 2020. Since then, Quinbrook has invested in Flexitricity's growth, more than doubling its contracted portfolio of flexible energy assets from 540 MW to c. 1.3 GW of distributed capacity including battery storage, industrial demand response, and flexible generation. From its 24/7 control room in Edinburgh, Flexitricity uses data science-powered optimisation tools and real-time trading to manage a portfolio of customer assets located across the UK. The business optimises these flexible energy assets across multiple markets and services, delivering value for a diverse range of customers whilst helping the National Energy System Operator (NESO) to balance the energy system. Flexitricity was founded in 2004 by Dr. Alastair Martin and is currently led by Andy Lowe, who was appointed CEO in 2022.
"Flexitricity was and remains today the true pioneer of flexible energy solutions in the UK market. Given the UK's ambitious net zero goals, we believed that our growth investment into the business represented an opportunity to create value for our investors which we have succeeded in doing with this sale to Drax," said Brian Restall, CEO of Quinbrook. "Through our close partnership with Andy, Alastair, and the rest of the management team, Quinbrook has helped the company evolve and expand its ability to deliver comprehensive, innovative and tailored solutions for its growing suite of customers in a complex energy landscape. We are proud of our collective achievements under Quinbrook's stewardship."
"As the retirement of the UK's older coal, nuclear and gas power stations has accelerated, Flexitricity has played a pivotal role in supporting more flexible and customer-focused energy solutions," said Keith Gains, Managing Director and UK Regional Lead at Quinbrook. "With the UK's Clean Power 2030 goals fast approaching, the flexible, firming of reliable supply and grid reliability provided by Flexitricity will remain a key component of the energy transition. We look forward to the company's continued success in this next growth chapter under Drax's ownership."
Headquartered in Edinburgh, Flexitricity today employs over 85 people across operations, technology, engineering, finance, sales and trading. In addition to the company's contributions to support the energy transition, Flexitricity has enacted strong ESG credentials including jobs training and rigorous oversight to ensure ethical supply chains.
"Quinbrook brought both strategic focus and momentum to a long-standing, 16-year business, helping to accelerate our transformation into a scaled, tech-enabled market-leader," said Andy Lowe, CEO, Flexitricity. "Under their ownership, we more than doubled our portfolio capacity, embedded data-science capabilities into our trading platform, and launched major new growth initiatives including FlexGO, which we expect to be revolutionary for consumer-led flexibility. Quinbrook's support has positioned us strongly for the next chapter. It has been a privilege to partner with them."
The nature of the transaction means it requires approval from Government under the National Security and Investment Act of 2021 and notification to Ofgem with Ofgem confirming that it has completed its assessment of the transaction without any adverse findings, the only remaining conditions to completion of the transaction.
The flexible generation business Velox Power, currently operating under a single unified management team with Flexitricity, is not included in the transaction with Drax. Velox Power remains under Quinbrook's ownership.
Jefferies acted as the lead financial advisor on the transaction and DLA Piper served as legal counsel to Quinbrook.
About Quinbrook
Quinbrook is a specialist investment manager focused exclusively on the infrastructure needed to drive the energy transition. Led and managed by a senior team of energy industry professionals, Quinbrook is an accomplished asset creator and business builder that conceives, develops, constructs and operates a diverse array of innovative infrastructure projects and growth platforms. Since its founding in 2015, Quinbrook has invested in over 40 GW of energy infrastructure assets and businesses representing a total transaction value exceeding USD 27 billion spanning large-scale renewable power generation, biofuels production, long duration storage, hyperscale data centre infrastructure, AI powered asset optimisation, grid support and flexibility solutions in North America, the UK/Ireland and Australia.
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