GreatPoint Energy Case Study

 
greatpoint 

About GreatPoint Energy

  1. GreatPoint Energy develops, owns and operates large-scale industrial facilities to convert coal into natural gas using the company’s proprietary bluegas™ technology
  2. bluegas™ uses catalytic hydromethanation, a process by which carbon-rich feedstocks are converted through a combination of catalytic reactions into a methane-rich gas stream
  3. GreatPoint Energy is headquartered in Cambridge, Massachusetts.  Its existing investors include Advanced Technology Ventures, Draper Fisher Jurvetson, Kleiner Perkins Caufield & Byers, Khoshla Ventures, Citi Capital Advisors, AES Corp, Dow Chemical, Peabody Energy and Suncor Energy
  4. GreatPoint Energy is pursuing an aggressive growth strategy in Asia and other developing economies

Overview and Challenges

  1. Founded in 2004, GreatPoint Energy has proven the viability of its bluegas™ technology through thousands of hours of online operation at the company’s bench, pilot and demonstration facilities
  2. GreatPoint Energy was looking for a strategic partner with access to the financial and commodity resources required for the development of large-scale coal gasification facilities in Asia
  3. It was important for GreatPoint Energy to retain the ability to continue to pursue project development opportunities in non-Asia geographies

Our Advice and Execution

  1. GCA advised GreatPoint Energy on its $1.25 billion investment from China Wanxiang Holding Co., Ltd., a major China based industrial conglomerate.  The partnership included an investment commitment of over $420 million and a project equity and credit support partnership commitment of $830 million from Wanxiang Holding to GreatPoint Energy
  2. In addition to identifying Wanxiang, Greentech negotiated a highly customized investment structure to meet the goals of GreatPoint Energy’s existing equity investors, while providing Wanxiang with a pathway to acquiring a controlling interest in the company
  3. In conjunction with the investment, Wanxiang and GreatPoint Energy have formed a Joint Venture for the development of bluegas™ facilities in Asia and will build the first large-scale plant in China to convert coal into natural gas
  4. The transaction provides Wanxiang with an environmentally friendly technology for leveraging significant coal reserves in the Xinjiang province while creating a platform that will drive value creation for existing equity