Macquarie Infrastructure Company Enters into Agreement to Sell Minority Stake in District Energy Business

NEW YORK--(BUSINESS WIRE)--Macquarie Infrastructure Company (NYSE: MIC) announced that it has entered into an agreement to sell a 49.99% interest in its district energy business, Thermal Chicago, to an affiliate of The John Hancock Life Insurance Company for $29.5 million.

“and equally pleased to have a partner in John Hancock who clearly recognizes the benefits inherent in an investment in infrastructure. We believe that John Hancock will be an excellent business partner as we move forward.”

The Company expects the transaction to close prior to the end of the first quarter of 2010. MIC, through its downstream entity MDE Holdings LLC, will remain the managing member of the company that owns the district energy business.

James Hooke, Chief Executive Officer of Macquarie Infrastructure Company, said “The sale of a non-controlling interest in the district energy business has two distinct benefits. First, the sale generates cash that will help eliminate our long-term holding company debt and advances the point at which we may be able to resume distributions to shareholders. Second, the sale affirms the value in the businesses MIC owns and the value that has been added to these businesses under MIC’s ownership.”

The implied valuation for the whole of the district energy business equates to an 11.6 times multiple of trailing twelve month enterprise value to EBITDA. The multiple reflects improvements in the business made during MIC’s ownership including:

• operational improvements;
• the extension of the Use Agreement with the City of Chicago from 2020 when MIC acquired the business to 2040;
• successful management of the transition to a deregulated electricity market in Illinois; and
• system capacity expansion.

“We’re pleased to be able to retain the upside in this business,” Hooke added, “and equally pleased to have a partner in John Hancock who clearly recognizes the benefits inherent in an investment in infrastructure. We believe that John Hancock will be an excellent business partner as we move forward.”

Closing is subject to satisfaction of certain conditions consistent with a transaction of this type and size.

The Company’s district energy business comprises five cooling plants in downtown Chicago, a standalone facility outside of the central business district and a separate operation in Las Vegas. The Chicago plants produce chilled water for use in cooling approximately 100 high rise buildings. The smaller Las Vegas facility provides cold and hot water for cooling and heating to a number of Las Vegas buildings.

MIC intends to combine the net proceeds of the sale with existing resources to repay its holding company revolving credit facility. The Company had $66.4 million of holding company debt outstanding at September 30, 2009 on a facility that matures March 31, 2010.

About Macquarie Infrastructure Company

Macquarie Infrastructure Company owns, operates and invests in a diversified group of infrastructure businesses providing basic, everyday services, to customers in the United States. Its ongoing businesses consist of three energy-related businesses including a 50% indirect interest in a bulk liquid storage terminal business (International-Matex Tank Terminals), a gas production and distribution business (The Gas Company in Hawaii) and a district energy business (Thermal Chicago) as well as an aviation-related airport services business (Atlantic Aviation). The Company is managed by a wholly-owned subsidiary of the Macquarie Group. For additional information, please visit the Macquarie Infrastructure Company website at www.macquarie.com/mic.

“Macquarie Group” refers to the Macquarie Group of companies, which comprises Macquarie Group Limited and its worldwide subsidiaries and affiliates. Macquarie Infrastructure Company LLC is not an authorized deposit-taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia) and its obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542 (MBL). MBL does not guarantee or otherwise provide assurance in respect of the obligations of Macquarie Infrastructure Company LLC. MIC-G