Former Aquila CEO Helps Form Energy Infrastructure Investment Company

By Kansas City Business Journal

A trio of Leawood companies has formed Corridor Energy LLC, a company that â¿¿ at this point â¿¿ will provide guidance to investors about buying energy and power company real estate that can be leased back to the companies.

A fund run by one of the founders, Tortoise Capital Advisors LLC, will have the right of first refusal to finance any investment opportunities; itâ¿¿s an open question about how investments might be structured in the future, a spokeswoman said.

According to a Wednesday release, Corridor Energy plans to offer growth capital to finance energy infrastructure assets used for electric power transmission and distribution, natural gas and liquid transportation, and storage facilities.

The assets â¿¿ which rely on real estate corridors for right of way and are key to energy delivery â¿¿ could bring qualification as a real estate investment trust.

The new entity involves familiar local players â¿¿ particularly Richard Green, former CEO of utility Aquila Inc. and Utilicorp United. He is a founder of The Calvin Group, which helped form Corridor Energy, and heâ¿¿ll be managing director of the new company and lead its management team.

In addition to principals of The Calvin Group (Green, David Haley and Becky Sandring), Corridor Energyâ¿¿s founders include Tortoise and its majority owner, Montage Asset Management LLC. The new company will gain by having access to the capital markets through Tortoise and to Tortoiseâ¿¿s financial and research expertise, the release said.

Corridor Energy will aid Tortoise Capital Resources Corp. (NYSE: TTO) â¿¿ a fund managed by Tortoise Capital Advisors â¿¿ in analyzing and financing potential investments, and figuring out which investments can be leased to businesses.

But at this point, Tortoise Capital Resources can invest only until it reaches limits under laws requiring it to invest at least 70 percent of its assets in securities of private companies. The company has about $15 million to invest before it reaches that limit. To invest more, the company must withdraw its status as a business development company. Doing so requires shareholder approval, so it has filed a preliminary proxy statement with the Securities and Exchange Commission announcing its intent to gain that approval. Tortoise Capital Resources plans to seek permission from shareholders but wonâ¿¿t withdraw from business development company status until it reaches the limit and sees a need for further investment.

Corridor Energy is owned by its management team (The Calvin Group team as well as Tortoise Managing Director David Schulte), Tortoise and Montage.

Tortoise Capital Advisors is an investment manager that has specialized in listed energy infrastructure investments such as pipeline and power companies. It has about $6.1 billion in assets under management.

Montage, a group of asset managers, has about $8 billion in assets under management.

Copyright 2011 American City Business Journals

http://www.bizjournals.com/kansascity/news/2011/01/12/former-aquila-ceo-helps-form-energy.html?ana=thestreet

Copyright bizjournals.com 2010

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