The New York City industrial demolition firm that wants to buy and tear down the closed Vermont Yankee nuclear power plant has a new owner with deep pockets.
J.F. Lehman & Company, also known as JFLCO, has “recapitalized” NorthStar Group Holdings LLC, and its subsidiary, NorthStar Group Services Inc, according to a news release from Lehman.
The transaction, which was completed in June, comes after mounting criticism that NorthStar didn’t have the financial wherewithal of Entergy Nuclear, and its parent company, Entergy Corp., in case something went wrong with the decommissioning and cleanup of Vermont Yankee, which Entergy shut down in December 2014.
Gov. Phil Scott’s administration, through the Department of Public Service, raised a red flag about the proposed sale in filings with the Nuclear Regulatory Commission last month, saying the transaction posed a “significant risk” to the state.
While not acknowledging the state’s criticism, NorthStar said the new owner would give it financial stability.
“JFLCO’s recapitalization of our company will enable NorthStar to fully pursue business opportunities which the management team has laid the foundation for over the past several years,” Scott State, NorthStar’s chief executive officer, said in a statement released Monday.
“NorthStar will have the resources, capital structure and operational resources to support our long-term priorities and growth plans,” he said.
State wasn’t available for comment Monday.
In a filing with the state Public Utilities Commission (formerly the Public Service Board), NorthStar Group Services officials said the affiliation with Lehman was part of the company’s strategy to obtain “additional resources and financing access.”
“ The recapitalization transaction was part of an overall strategy to obtain additional resources and financing access to support the nuclear decommissioning business and other strategic initiatives,” according to new testimony from Jeff Adix, vice president and chief financial officer of NorthStar Group Services.
“This transaction brought new capital into the company, de- leveraged its balance sheet, and extended the company’s existing senior credit agreement on more favorable terms,” he said.
J.F. Lehman was described as “a leading mid-market private equity firm,” with a concentration on the aerospace, defense and maritime industries.
Previously, NorthStar had been owned by LVI Group Investments and NCM Group Holdings, two large demolition companies that were suing each other, alleging fraud and financial misrepresentation in their merger documents.
State is a former executive with LVI.