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Start-up Star Energy Partners Preparing Retail Market Entry; FirstEnergy Holds Minute Voting Interest in Company
November 2, 2012
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A new start-up retail supplier led by Tony Banks, called Star Energy Partners, is preparing to launch operations.
Star Energy Partners applied for FERC market-based rate authority yesterday, and stated that it, "intends to be certified to act as a retail supplier of electricity in various jurisdictions."
Star Energy stated that it is in the process of preparing applications to obtain authorization to sell electricity and/or natural gas at retail in various state jurisdictions
Star Energy is owned by Tony Banks and FC Energy LLC (FC Energy).
FC Energy is a wholly-owned subsidiary of First Communications, Inc.
First Communications provides local, long-distance and data telecommunications services to residential and commercial customers throughout the U.S., including public utilities and associated companies within FirstEnergy Corp. (FirstEnergy). Several investment funds and companies currently own First Communication's common stock. FirstEnergy and Marbel Investments are the two largest stockholders, and the only ones with over 10% ownership.
Mr. Banks holds a 55% equity interest in Star Energy, and controls 85% of voting interest in the common stock. FC Energy holds a 45% equity interest in Star Energy, and controls 15% of the voting interest in the common stock. Under Star Energy's corporate structure, no party or individual possesses any other voting rights, or other right to control Star Energy.
FirstEnergy currently owns 27.4% of the common stock of First Communications. Accordingly, FirstEnergy's current voting interest in Star Energy is approximately 4%.
Update: On Nov. 21, Star Energy Partners provided the following update to FERC in its ownership structure:
"[I]t is anticipated that Star Energy will purchase power from FirstEnergy Solutions to serve its retail customers in the PJM Interconnection, LLC service territory under a supply agreement for electricity," Star Energy stated.
Banks serves as President and Chief Executive Officer of Star Energy. Banks was most recently Vice President of Competitive Market Policies at FirstEnergy Solutions, and was previously Vice President of Product & Business Development at FES.
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"[T]he voting interest in Star Energy has shifted such that Mr. Banks now holds a 92% voting interest in the common stock, and FC Energy holds an 8% voting interest in the common stock. No changes have been made to the parties’ equity interest in Star Energy."
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