STAR Capital Partners buys from TotalFinaElf.

Investee Company – Inexus Ltd (UK)

Investee Company Business Type – Holding company for acquired gas pipeline companies

Type of Financing – Acquisition for expansion financing

Equity Providers – STAR Capital Partners

Equity Leader (Individual) – Stephen Wright, managing director STAR

Debt Providers – Royal Bank of Scotland

Debt Type – Senior bank debt

Debt Leader (Individual) – Undisclosed

Equity Amount – Undisclosed

Total Deal Value – £100 million, (euro158 million)

Other Advisors – Lehman Brothers and PricewaterhouseCoopers acted for STAR. ABN AMRO acted for TotalFinaElf (vendor)

Comments – STAR Capital has completed the first transaction for its newly closed STAR 1 fund. The firm set up a new company, Inexus, to act as a holding company for newly acquired companies TotalFinaElf Connect (connect), and TotalFinaElf pipelines (TPL), from TotalFinaElf Midstream UK Ltd.

The two newly acquired branch companies install, maintain, and own pipelines that connect UK domestic households to gas supplies. STAR and the management have acquired the companies, through the back with STAR putting up the majority of an undisclosed amount of equity. Royal Bank of Scotland has provided the debt financing in a total package worth £100 million.

Philip Gibb, part of the management of TotalFinaElf, and now the new CEO for Inexus, said: “The merger of the two acquired businesses together with the financial support of STAR Capital will enable us to implement our strategic plans to develop the business beyond the gas market.”

Stephen Wright, managing director at TotalFinaElf Midstream (UK) Ltd, said: “This innovative deal launches our strategy to invest in high quality assets which provide an attractive stable yield as well as the opportunity for capital growth. We will continue to target capital-intensive businesses which have strong market positions, excellent management and which will benefit from additional investment.”

STAR 1 fund had its first closing at euro272 million in February of this year, and is looking to complete its second close by the end of the year at around euro500 million.