Infracapital, the infrastructure equity investment arm of M&G Prudential, has agreed to acquire a controlling equity stake in UK Power Solutions (“UKPS”), a leading ‘last mile’ utility business, from individual shareholders including management.
UKPS designs and builds ‘last mile‘ electricity, gas and water networks, connecting end customers to the relevant upstream distribution utility‘s network. Its dedicated teams of experienced engineers manage projects from the initial customer enquiry, through to design, construction, energisation and the final adoption of the network. Since 2007, UKPS has grown to become one of the UK’s leading multi-utility connections providers for new build residential, high rise, commercial and retail projects, with an order book in excess of 120k connections. The business has a particularly strong presence in the South and Midland regions of England.
The acquisition follows Infracapital‘s October 2018 investment in last mile electricity, gas and water connections business, Energetics, which has a strong presence in Scotland and the North of England and an order book in excess of 200k connections. The two businesses will operate independently but alongside each other as part of the Last Mile Infrastructure Group owned by Infracapital.
The Last Mile Infrastructure Group is one of the UK’s largest Independent Network Owners, owning and operating in excess of 300k gas and electricity connections servicing residential and commercial customers. The management team have plans to significantly grow the business and UKPS is expected to make an important contribution.
Infracapital will take a 65% stake in UKPS, with management shareholders retaining the balance.
Hamza Khan, Transaction Director at Infracapital, said:
“UKPS is an attractive addition to our existing investments in the last-mile utility connections market in line with our strategy of investing in platform businesses for our third brownfield infrastructure fund to deliver value and sustainable growth for our investors. The experienced management team at UKPS have created a successful origination platform, supported by a highly skilled workforce and a track record of delivering stable performance. Infracapital looks forward to supporting the continued growth of the business.”
Mike Pearce, CEO of Last Mile Infrastructure Group, said:
“I am delighted to welcome UKPS to the Last Mile Infrastructure Group and I look forward to working closely with the Directors of the business. This acquisition means that we are very well placed to capitalise on the sizeable and growing opportunities available in the UK utility connections market.”
Brian Cooke, Sales Director at UKPS, said:
“The UKPS senior management team are truly excited with the opportunity that has been presented to the company. The acquisition by Infracapital will enable us to realise our long-term ambitions for the growth of the business and the security of our dedicated staff. Our valued customer base can expect things to be business as usual and we look forward to providing not only an exceptional service but also continuing the valued relationships we have built up over so many years.”
PwC Corporate Finance acted as financial adviser to Infracapital on the transaction.
Infracapital, the unlisted infrastructure equity arm of M&GPrudential, invests in, builds and manages a diverse range of essential infrastructure to meet the changing needs of society and support long-term economic growth. We take an active role in all of our investments, whether nascent or large, to fulfil their potential and ensure they are adaptable and resilient. Our approach creates value for our investors, as we target investments with the scope for stable and sustainable growth. Our portfolio companies work closely with the communities where they are based, to the benefit of all stakeholders. Infracapital is well positioned to deliver the significant investment required to help build the future. The founder-led team of experienced specialists has worked with 50 companies around Europe and has raised and managed over £5 billion across five funds.
M&GPrudential is a leading savings and investments business which was formed in 2017 through the merger of Prudential plc’s UK and Europe savings and insurance operation and M&G, its wholly owned international investment manager. In March 2018, Prudential plc announced its intention to demerge M&GPrudential and give it a premium listing on the London Stock Exchange. In August 2019, M&GPrudential announced its intention to list its shares under the name M&G plc when it demerges from Prudential plc in the fourth quarter of this year.
UKPS is one of the UK’s leading independent connection providers building new electricity, gas and water networks for the residential, mixed use, industrial and commercial markets. The business delivers a turnkey solution, from initial customer enquiry through to design, construction, energisation and final adoption by the relevant asset owner/network operator. UKPS has a broad, diverse and longstanding customer base that includes established housebuilders, developers and consultants. The company has corporate offices in London, Gloucester and Warrington.
If you require any further information, please contact:
Tom Murray / Nick Laitner / Amber Ahluwalia
Tulchan Communications representing Infracapital
+44 20 7353 4200
+44 20 3977 3284
+44 14 5379 4817