Alterna inks first deal

The Connecticut-based private equity firm has purchased a 43% stake in an Arizona coal power station, as it continues raising its debut fund.

Connecticut-based Alterna Capital Partners has purchased a 43 percent interest in a coal-fired power plant in Arizona, the first deal from its debut fund.

The plant is part of the Springerville Power Generating Station in Springerville. The 380-megawatt power station was purchased from Philip Morris Capital, an investment affiliate of the US tobacco company. Terms of the transaction were not disclosed.

Alterna said in a statement the facility is on lease to an Arizona utility, Tucson Electric Power, through 1 January 2015
Alterna pursues opportunities in what it calls the “core capital” asset sectors: long-lived physical assets and resources essential to the transportation, industrial and energy sectors.

Jim Furnivall, a managing partner at Alterna, said these opportunities tend be assets such as locomotives, ships and energy production equipment. Furnivall said these industrial assets are “absolutely vital” for the successful operations of the corporations that use them.

Alterna was founded by managing partners Harry Toll, Roger Miller and Eric press, who previously invested in core capital assets at Citigroup.

They started raising Alterna’s first fund for core capital assets in the middle of last year. It was originally targeting $1 billion in total investor commitments, but due to the economic climate, the fund is likely to hold a final close at about $400 million. To date, it has secured more than $300 million in investor commitments, according to a press release.

In January, the $4.9 billion Arizona Public Safety Personnel Retirement System committed $70 million to the fund, according to Pensions and Investments. Of the $70 million, $40 million was a direct investment in the fund and $30 million was a co-investment allowing the pension to invest into specific assets in which Alterna invests.

Alterna is based in Wilton, Connecticut. It has a team of eight investment professionals, Furnivall said.

CP Eaton is acting as placement agent for Alterna.