Viridian Group, the energy company, is in the process of raising over $250 million (€194 million) in fresh finance in the US private placement market, it confirmed yesterday.
The company is the latest in a long line of Irish firms tapping the US private placement market for funds. The market is highly competitive at present and companies are keen to take advantage of well-priced funds. ESB, the Quinn Group, Kingspan and Bord Gaís are just some of the Irish companies that have taken this route. This is the first time Viridian has raised finance in this way.
Viridian Group is believed to be using RBS Greenwich Capital to organise the raising of the debt, sources said. Utility firms are usually able to avail of a strong credit rating.
A private placement is a debt or equity security sold in the US that is exempt from registration with the Securities and Exchange Commission.
It is understood Tiernan O'Mahony's financial institution International Securities Trading Corp recently completed a $75 million transaction on the US private placement market.
A Viridian spokesman yesterday declined to specify the exact use of the funds, but it is understood that on Monday Viridian and the energy regulator in the North, Ofreg, will announce a new price control for Northern Ireland Electricity, a Viridian subsidiary.
This will usher in a five-year capital investment programme in Northern Ireland's energy infrastructure worth about £500 million (€742 million).
The company is also building a new power station at Huntstown, north Co Dublin. This will be a gas-fired 400-megawatt power station.
Apart from that, the company is seeking to avail of further energy opportunities in the years ahead. It is part of a consortium hoping to build a new electricity inter-connector between Ireland and Wales.
The company is also understood to be interested in building up its land bank in the Republic so that it can develop more power stations in future as demand for electricity increases.
Energy firms have been cropping up regularly on the US private placement market. Comisión Federal de Electricidad, a Mexican utility, is looking to enter the market and is being advised by Goldman Sachs.
