Exclusive: CPE Invests 10 Million Euros in Norwegian Solar Firm

By Nina Chestney, Reuters
February 3, 2010

Climate Change Capital Private Equity (CPE) has invested 10 million euros ($14.01 million) in Norwegian solar company Metallkraft AS through a convertible bond issue, the fund told Reuters on Wednesday.

CPE is a 200-million euro fund which invests in clean technology companies. It subscribed for 85 million Norwegian krones (10.3 million euros) out of the 140 million krones total convertible bond issue along with existing shareholders and other undisclosd investors.

The fund told Reuters last week that it was set to lead a multi-million euro investment in the solar industry imminently.

CPE said on Wednesday that the convertible bonds have a 12 percent coupon per year and a three-year term.

Metallkraft, which is not listed on the stock exchange, has developed a patented process to recover the spent slurry used in the silicon solar wafer cutting process.

The company will use the investment to support its new plant in Singapore, which will service a 740 megawatt solar silicon wafer plant being commissioned by the Renewable Energy Corporation.

The proceeds will also support Metallkraft's future expansion plans in China.

"Metallkraft is a perfect fit for CPE's investment strategy. We firmly believe that Metallkraft's management team is one of the best we have seen and in my experience this is the most important investment factor to get right," said Simon Drury, a partner at CPE.

Drury will take a seat on Metallkraft's board of directors.

Citi Plans Sale of Private Equity Unit: Report

Reuters
January 22, 2010

Citigroup Inc plans to sell or spin-off its $10 billion Citi Private Equity unit in order to cut its debt, Bloomberg reported on Sunday, citing people familiar with the matter.

Citigroup made the decision to sell the unit last year, before President Barack Obama announced his plan to limit financial risk-taking by banks, according to the article. That plan could force banks to shed parts of their private equity operations.

One person familiar with the matter told Bloomberg that managers of the unit have discussed buying it out themselves with partners or other financing.

The unit oversees about $2 billion of Citi's money, with the remainder coming from outside investors according to the report.

Citigroup spokeswoman Shannon Bell declined to comment on the matter, when contacted by Reuters.

Carbon Trade Mustn't Be Victim of Bank Reform: HSBC

January 29, 2010

Reuters - Emissions trading should not be in the firing line of new banking regulations, said Stephen Green, group chairman of HSBC on Friday.

U.S. President Barack Obama last week proposed reforms, including regulation of proprietary trading where banks trade their own money and private equity investing by retail banks off their balance sheet in unlisted companies.

"There's a whole range of trading activities that are perfectly normal, legitimate, regular activities of the markets in support of economic and social development, and emissions trading is one of them," said Green, on the sidelines of a business and policy summit in the Davos Swiss ski resort.

"I don't think that will be characterized as proprietary trading, emissions trading is ... trading with clients. There is a debate to be had about proprietary trading (in other areas)."

HSBC on Monday invested $125 million off its own balance sheet in a private equity deal to support Better Place, a company which aims to roll out charging infrastructure for electric cars.

"It's exactly the kind of investment you want to see happen (to drive carbon emissions cuts) ... if we're allowed to continue to do that kind of thing," said Green, referring to prospective banking reforms.

"That's an investment we have made. Let's suppose commercial banks ended up not making investments in private equity, well, (low carbon businesses will) find other people making investments in private equity," he said.

Green was speaking on the sidelines of an event where six financial institutions underscored opportunities from investing in clean technologies, under a framework of "climate principles" launched in December 2008 to encourage such investment.

Banks say they are investing in clean tech despite a U.N.-led Copenhagen climate summit last month which failed to agree to replace the present Kyoto Protocol with a new, binding deal.

"We can't sit back and wait for that all-embracing accord that may one day emerge from the international governmental deliberations, we have to get going," said Green.