Millinium's Utilities Fund Assets
The Fund will provide funding to companies with assets that provide an ongoing yield and from time to time, longer term capital appreciation. This is achieved by accessing investments in utilities, especially energy, renewable energy and carbon related sectors. The Fund aims to enter into lending and/or equity arrangements to companies and/or institutions within the utilities sector that are likely to need or are experiencing difficulties in accessing new capital and/or refinancing of capital. The Fund will not invest in technology development itself but will focus on expansion and acquisition opportunities using known technologies.
- Investments are to include a wide range of transactions varying by industry within the utilities sector, size of investment and specific structure. However, all investments are to have a common trait, which is the underlying strength of the companies, institutions and management team which the Fund invests into. The types of opportunities we will consider are:
- Expansion/growth activities: Companies and institutions that seek additional capital to fund further growth and/or revenue either through acquisition or expansion or to meet their carbon emissions trading program. Typically, they should have a proven track record, experienced management team, positive operating cash-flow and identifiable growth prospects. The terms of each investment by the Fund will differ due to the structure and type of entity to be considered for investment.
- Public/private transactions: We will use or engage experienced specialists in evaluating and investing in public and private transactions for the Fund. Our ability to move rapidly can give us a competitive advantage in both closing transactions and the return to unit holders.
- Funding solutions: If the Fund provides capital to facilitate recapitalisation or refinancing, it may negotiate direct security in the investment, which is often more discreet, rapid and less complicated than alternative forms of capital raising. This leaves us with an ability to also negotiate, provide liquidity at the maturity of the Fund and boost potential returns, by accessing options for equity positions within a later IPO or sale of the investee company or asset. If we hold investments that become listed we intend to sell or divest our interest to increase returns to the Fund.
- Alliances: We are associated with organisations and specialists capable of providing carbon audit and carbon management services, together with investment advice and management of utilities, especially in the energy and carbon related sectors. These strategic relationships will assist us to acquire yielding interests in assets in Australia.
|Energy||Carbon Power||Coal fired power stations.|
|Gas Power||Natural gas and coal seam methane used to generate electricity and may include cogeneration or combined cycle technologies.|
|Wind Power||Ability of mechanical power to be converted to electricity by a generator.|
|Hydro-power||Conversion of energy of flowing water that drives turbines for electricity generators.|
|Biomass||Covers any organic matter converted into fuels that are used to produce electricity through a range of technologies including direct-combustion, co-firing, gasification, pyrolysis and anaerobic digestion.|
|Geothermal||Exploits heat initiatives of the earth for electricity production by using underground reservoirs of dry steam or hot water.|
|Solar||Allows energy of sunlight to be harnessed to generate electricity.|
|Waste fuels||Covers landfill gas, bio gas and process gas converted into fuel for power generation.|
|Infrastructure||Power||Covers transmission/distribution of power and gas transmission pipelines.|
|Ports||Initiatives in funding developments in shipping and port activities/utilities.|
|Rail||Initiatives in entities/utilities in rail access and improvements.|
|Toll Roads||Including toll bridges and toll tunnels and other ticketing or user charging systems that provide for a revenue stream.|
|Airports||Access and infrastructure services at and to and from airports including airfield runways, control towers, terminals and hangers.|
|Communications||Entities involved in the storage, transmission and reception of information or data.|
|Water||Water and Air purification||Reduction of waste, recycling, transmission and treatment technologies and business models.|
|Waste||Waste management||Covers entities/utilities involved in technologies and services in waste activities.|
|Other||Supplier activities||Climate change service providers and suppliers to this market segment, such as advanced materials and clean coal technologies, sustainable buildings or sustainable agriculture.|
Asset Selection Process
Our general selection process consists of the following steps aimed at creating a core portfolio of assets. We will utilise specialists to assist with construction of the asset portfolio and we set out below the stages of the process:
|Identification||Contribution to enhanced cash flow and/or any incidental purpose in our investment universe, if possible.|
|Screening||Put the asset through a system to vet for investment parameters, portfolio concentration and diversification, maximum loss criteria and asset backing.|
|Research/Qualitative Analysis||Analysis of market, review of background information on operations and analysis of various risk factors, including management, products or services, sales, potential and outlook, pricing, suppliers, financial records, predictable earnings, working capital, projections, forecast future profits and cash flow.|
|Approval/decline||Investment Committee approves or rejects submission.|
|Monitoring||Meet, review and conduct ongoing assessment of asset and management.|
|Utilities assets and other classes: Millinium Capital Managers Limited|