Monarch Alternative Capital invests $112.5M in Capstone Green Energy for AI data center microturbine solutions

Capstone Green Energy Holdings secured a $112.5 million strategic investment led by Monarch Alternative Capital to expand its behind-the-meter clean microturbine energy solutions, particularly targeting emerging AI data center applications. The transaction included $80 million in senior convertible preferred stock and $15 million in common stock issued to Monarch, alongside a $17.5 million concurrent private placement to accredited investors, including existing backers. Capstone used $85 million of the proceeds to redeem preferred equity held by Capstone Distributor Support Services, a Goldman Sachs-controlled entity, consolidating its capital structure. The remaining funds will support growth initiatives such as expanding into the AI data center market, enhancing engineering capabilities, increasing production capacity, and implementing cost-reduction measures. As part of the deal, Monarch gained the right to appoint two independent directors to Capstone’s board, subject to ownership thresholds, and Capstone committed to filing for a U.S. national securities exchange listing within 12 months.

Counterparts (2)

borrower

Capstone Green Energy Holdings

company

Van Nuys-based manufacturer of oil-free microturbine systems for energy efficiency, renewable energy, and critical power applications with global operations in 88 countries. Specializes in scalable solutions for data centers, oil & gas, microgrids, and EV charging infrastructure.

Investor

M

Monarch Alternative Capital

company

New York-based alternative investment manager specializing in infrastructure with $4.5B AUM. Focuses on energy transition, transport, and utilities assets across North America and Europe with a selective global footprint.