TPG to acquire Altus Power in $2.2bn all-cash deal to drive clean energy growth

Altus Power, Inc., the largest owner of commercial-scale solar energy assets in the United States, has announced a definitive agreement to be acquired by TPG Rise Climate Transition Infrastructure in an all-cash transaction valued at approximately $2.2 billion, including outstanding debt. This acquisition marks a significant strategic shift for Altus Power, as it prepares to transition from a publicly traded company on the New York Stock Exchange to a privately held entity.

The deal, set at $5.00 per share of Class A common stock, represents a substantial 66% premium over Altus Power’s closing price on October 15, 2024—the day before the company announced a formal review of strategic alternatives. The transaction is expected to close in the second quarter of 2025, subject to shareholder approval and regulatory clearances.

Why is TPG acquiring Altus Power?

TPG’s decision to acquire Altus Power through its TPG Rise Climate Transition Infrastructure platform aligns with its broader strategy to invest in sustainable infrastructure and accelerate the global transition toward renewable energy. TPG Rise Climate has positioned itself as a leader in climate-focused investments, and the acquisition of Altus Power reinforces this commitment.

Altus Power has built a strong reputation as a leader in the commercial-scale solar energy sector, providing clean electric power solutions to a wide range of businesses and communities across the United States. The company’s extensive portfolio of solar assets and expertise in managing large-scale renewable energy projects made it an attractive target for TPG.

Gregg Felton, Chief Executive Officer of Altus Power, described the acquisition as a transformative moment for the company. He emphasised that TPG Rise Climate’s investment philosophy, focused on sustainability and infrastructure growth, aligns with Altus Power’s long-term vision. Felton believes that this partnership will enable Altus Power to scale its operations more rapidly, meet the growing demand for renewable energy, and drive innovation within the clean energy sector.

How will the acquisition impact Altus Power’s growth?

Altus Power expects the acquisition to significantly enhance its ability to deliver greater value to its customers, both in the commercial sector and through its Community Solar programmes. By combining TPG Rise Climate’s financial strength and investment expertise with Altus Power’s operational capabilities in commercial-scale solar energy, the company aims to accelerate its growth trajectory.

Felton highlighted that transitioning to a privately held company will provide Altus Power with increased flexibility to focus on long-term strategic initiatives. This shift is expected to reduce the pressures of quarterly financial reporting, allowing the company to prioritise sustainable growth, technological innovation, and operational efficiency.

Christine Detrick, Chair of Altus Power’s Board of Directors, expressed strong support for the transaction, noting that the board had unanimously approved the deal. She stated that the acquisition would unlock significant value for shareholders, customers, and employees, positioning Altus Power for long-term success in the evolving energy landscape.

What does TPG Rise Climate bring to the table?

TPG Rise Climate, the climate-focused investment strategy of TPG, has a proven track record in supporting companies that are driving the transition to a low-carbon economy. The firm’s expertise in sustainable infrastructure investments and its global network of resources are expected to play a crucial role in Altus Power’s next phase of growth.

Scott Lebovitz, Managing Partner and Head of Infrastructure at TPG Rise Climate, praised Altus Power’s leadership and operational excellence in delivering clean electric power solutions. He highlighted the company’s impressive growth trajectory and commitment to sustainability, which aligns closely with TPG’s investment objectives.

Steven Mandel, Business Unit Partner at TPG Rise Climate, echoed these sentiments, emphasising that TPG is committed to supporting Altus Power’s expansion efforts. Mandel noted that the partnership would help Altus Power enhance its capacity to provide affordable, reliable, and sustainable energy solutions to businesses and households across the country.

What are the terms and conditions of the deal?

The transaction has been unanimously approved by Altus Power’s Board of Directors, which recommends that shareholders vote in favour of the merger agreement at an upcoming Special Meeting of Stockholders. Shareholders representing approximately 40% of Altus Power’s Class A common stock, including entities managed by Blackstone Credit and Insurance and a subsidiary of CBRE Group, Inc., have already entered into voting agreements supporting the deal.

The acquisition is subject to the approval of a majority of Altus Power’s outstanding Class A common stock, as well as customary closing conditions, including regulatory approvals. Notably, the transaction is not contingent on financing conditions, which is expected to streamline the closing process.

Upon completion of the deal, Altus Power will maintain its headquarters in Stamford, Connecticut, and continue its focus on expanding its commercial-scale solar energy operations nationwide.

Who advised on the acquisition?

In connection with the transaction, Altus Power received financial advisory services from Moelis & Company LLC, while Latham & Watkins LLP provided legal counsel. TPG Rise Climate was advised by PJT Partners on financial matters, with Kirkland & Ellis LLP serving as its legal counsel.

These advisory roles played a crucial part in structuring the deal and ensuring that both parties’ strategic objectives were aligned throughout the negotiation process.

What’s next for Altus Power?

The acquisition by TPG Rise Climate marks the beginning of a new chapter for Altus Power. As the demand for clean electric power continues to rise in response to climate change and evolving energy policies, Altus Power is well-positioned to capitalise on emerging opportunities in the renewable energy sector.

With TPG’s backing, Altus Power aims to accelerate the development of new solar projects, expand its customer base, and invest in advanced technologies to improve energy efficiency and sustainability. The company’s leadership believes that this partnership will enable Altus Power to play an even more significant role in the global transition to a clean energy future.