News

GFI Energy Ventures Acquires NORESCO

January 09, 2006 by Jeff Shepard

NORESCO, one of the largest providers of energy management and performance contracting services in the United States, has been acquired by a fund managed by GFI Energy Ventures LLC from Equitable Resources Inc. The sale completes the previously announced strategic review by Equitable, which concluded that the characteristics of NORESCO's business were inconsistent with Equitable's regional, asset optimization focus.

"Because of NORESCO's national reach, technological independence, engineering and project management expertise, the Company is exceptionally well positioned to capitalize on the increasing focus by government agencies and commercial and industrial companies on improving energy and environmental efficiency," said Andrew Osler of GFI Energy Ventures. "High energy prices, new and improved energy consuming and energy managing technologies, and expanded government and utility incentives have created an environment in which we believe NORESCO will prosper. For these reasons, GFI Energy Ventures is delighted to add NORESCO to our portfolio of industry-leading companies."

"This is a terrific opportunity for us," said Neil Petchers, President and CEO of NORESCO. "As an independent company, NORESCO will be able to unleash the full entrepreneurial spirit of our talented and committed employees and capitalize on market conditions that have never been better for the services we provide. With energy prices likely to remain high for the foreseeable future and with more facility owners focusing on energy management as an operational priority, we believe our customers will increasingly look to us for the professional expertise needed to implement complex energy management solutions. When combining the freedom and flexibility NORESCO shall have as an independent operating company, with the current energy and environmental market trends and the financial and operational backing of GFI Energy Ventures, we see an exciting, growth-oriented future for our company."

For more than 20 years, NORESCO has developed energy projects for customers, such as the federal government, that achieve energy efficiency, environmental and cost management goals recently strengthened by federal policy. The 2005 Energy Policy Act established a 20 percent energy reduction target for federal facilities by 2016 and outlines federal assistance for state energy reduction programs by 2012.

GE Energy Financial Services provided cash flow-based senior debt financing to support the acquisition of NORESCO. The transaction allows Equitable to focus on its core businesses of natural gas supply and utility operations while enabling NORESCO to grow as an independent service provider, backed by the financial resources and sector expertise of one of the largest private equity funds focused in this area.