3i and Advanced Power today announce that 3i, together with members of the board of Advanced Power, have agreed to invest €31.5m in Advanced Power AG, a Swiss-based development business focused on developing conventional power generation stations across Europe and North America. Advanced Power has a pipeline of 10 developments at different stages, all expected to receive planning permission within the next 5 years, and the most advanced within 9 months.

The demand for new power generation capacity is being driven by a number of factors, including increased global consumption and the replacement of ageing infrastructure.  Whilst renewable generation will fill part of the generation gap, conventional power generation (gas or coal fired) will play an important ongoing role.

Advanced Power’s management team, made up principally of former senior executives from InterGen, one of the most successful developers of independent power projects over the last decade, is led by CEO Dr. Martin Giesen and includes Mathew Brett, Managing Director, Tom Spang, President Advanced Power North America, Peter Ramm, Technical Director and Martin Bashall, General Counsel.  The strong executive team will be complemented by the addition of Ian Russell, former CEO of Scottish Power, who will join the board as Chairman and also by George Verberg, former CEO of Gasunie, joining the board as Non-Executive Director.  Advanced Power was advised on this transaction by RBC Capital Markets and Simmons & Simmons

Mark Kerr, Director, 3i Oil, Gas & Power, commented: “Advanced Power operates in an attractive and fast growing market characterised by increasing global demand for power and a rapidly ageing generation fleet.  We believe that the company has first mover advantage and is well placed to exploit this opportunity on the back of a very experienced management team and an attractive starting development portfolio. The investment further demonstrates 3i’s commitment to the gas and power sector.” 

Martin Giesen, CEO of Advanced Power, commented: “3i is the ideal partner for us as we look to take the next step in establishing ourselves as the leading independent developer of power generation projects in our target markets.  Besides capital, 3i has a strong track record of investing in our sector as well as an invaluable global network which mirrors the countries in which we operate, as demonstrated by the introduction of Ian Russell as Chairman.”