MEAG acquires iCON Infrastructure stake in London waste to energy plant
German asset manager MEAG has acquired a minority stake in the South East London Combined Heat and Power (SELCHP) plant in London. The seller of the 49.78 per cent interest in the waste-to-energy (wte) facility is investment company iCON Infrastructure Partners. MEAG, the asset manager of reinsurer Munich Re, did not disclose the purchase price.
Image: Veolia
French environmental services group Veolia is the majority shareholder in the plant and is responsible for its operation. The facility in Bermondsey, south-east of central London, opened in 1994 and has two lines with a combined treatment capacity of 464,000 tonnes per year. It has electrical generation capacity of up to 35 MW and also supplies district heating and hot water to 2,800 buildings in the London Borough of Southwark.
The plant was designed and built by French engineering company CNIM, which also held a stake in SELCHP through CNIM Development, a joint venture with financial investor Cube Infrastructure. In 2018, iCON Infrastructure acquired this holding, representing 48.75 per cent of the share capital, for an undisclosed sum.
MEAG noted that the facility benefits from long-term, inflation-indexed waste supply contracts underpinned by expected stable and high waste volumes in its catchment area. It also generates revenue through power offtake.
David Pecher (left) and Tobias Kerschbaumer
"This acquisition is a strong fit for our infrastructure equity strategy: long-term contracted revenues, low correlation to broader market cycles, and a defensive risk profile that complements our existing portfolio," said David Pecher, head of infrastructure equity transactions at MEAG.
Image: Veolia
Tobias Kerschbaumer, senior investment manager at MEAG, highlighted the position of waste-to-energy assets "at the intersection of essential infrastructure and the energy transition":
"They solve a waste management need while generating reliable power and heat. That combination of social utility and predictable cash flow is exactly what we look for in core infrastructure."