October 5, 2015 / 10:17 AM / 3 years ago

UPDATE 2-APR Energy in buyout talks with largest shareholder

* Co in buyout talks with three-company consortium

* Co hit by contract terminations in Libya, Yemen

* Shares jump as much as 90 pct, top gainer on LSE (Adds details, background, updates shares)

By Esha Vaish and Aastha Agnihotri

Oct 5 (Reuters) - Power plant supplier APR Energy Plc is in talks to be bought out by a consortium that includes its largest shareholder after a year dogged by the loss of projects in war-torn regions.

APR’s London-listed shares rose as much as 90 percent on Monday after the company revealed talks with a group comprising Fairfax Financial Holdings Ltd, ACON Investments LLC and Albright Capital Management LLC.

APR, which rents out turbines and generators to cover electricity shortfalls, had a market value of about 88 million pounds ($134 million) based on the roughly 94 million shares it had outstanding as of Friday’s close.

Demand for temporary energy has risen in developing markets where utilities have been unable to keep pace with rapid economic growth, creating business for APR as well as larger rival Aggreko Plc.

But APR’s particular focus on emerging markets has also left it exposed to conflict and political tension. The collapse of a major contract in Libya preceded the company’s exit from Yemen in April, due to fighting there.

The suspension of its Libyan contract - the company’s largest ever, accounting for more than a third of its revenue last year - pushed APR to the brink of breaching its debt covenants.

The company managed to secure a renegotiation on its credit facility in April, thus avoiding a breach. Its lenders have granted a one-month extension of its next covenant testing date of Sept. 30.

Jacksonville, Florida-based APR said there was no certainty that any firm offer would be made by the consortium. It declined to comment further.

Fairfax Financial held an 18.3 percent stake in APR as of March 18, according to APR’s 2014 annual report.

Fairfax, ACON and Albright were not immediately available for comment outside regular business hours in North America.

APR’s stock has fallen about 83 percent in the 12 months to Friday’s close. At 1215 GMT on Monday, it was trading at 163.5 pence, up 74 percent. ($1 = 0.6576 pounds) (Reporting by Esha Vaish and Aastha Agnihotri in Bengaluru; Editing by Anil D’Silva and Robin Paxton)

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