News

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Toronto, Ontario (November 10, 2011) – Capstone Infrastructure Corporation (TSX: CSE; CSE.PR.A; CSE.DB.A – “CSE” or the “Corporation”) today announced that it has closed its previously announced offering of 12,000,000 common shares (the “Common Shares”) at a price of $6.25 per Common Share for aggregate gross proceeds of $75,000,000.

The Common Shares were sold to a syndicate of underwriters co-led by TD Securities Inc. and RBC Capital Markets on a bought deal basis. The underwriters are entitled, pursuant to an over-allotment option exercisable in whole or in part at any time up until 30 days after the closing date, to purchase an additional 1,800,000 Common Shares at $6.25 per Common Share which, if exercised in full, would increase the gross proceeds of the offering to $86,250,000.

The net proceeds of the offering will be used by the Corporation to repay a portion of the amount drawn on a senior credit facility used to fund the Corporation's recent acquisition of a 70% indirect interest in Bristol Water, a regulated water utility in the United Kingdom, thereby mitigating the risk related to refinancing the senior credit facility while increasing the Corporation's financial flexibility to pursue additional growth opportunities.

This press release is not an offer of securities for sale in the United States. The Common Shares have not been and will not be registered under the United States Securities Act of 1933 and accordingly will not be offered, sold or delivered, directly or indirectly within the United States, its possessions and other areas subject to its jurisdiction or to, or for, the account or for the benefit of a U.S. person, except in limited circumstances.

About Capstone Infrastructure Corporation
Capstone Infrastructure Corporation’s mission is to build and responsibly manage a high quality portfolio of infrastructure businesses in Canada and internationally in order to deliver a superior total return to shareholders through a combination of stable dividends and capital appreciation. The Corporation’s portfolio currently includes investments in gas cogeneration, wind, hydro, biomass and solar power generating facilities, representing approximately 370 MW of installed capacity, a 33.3% interest in a district heating business in Sweden, and a 70% interest in a regulated water utility in the United Kingdom. Please visit www.capstoneinfrastructure.com for more information.

Notice to Readers:
Certain of the statements contained within this news release are forward-looking and reflect management’s expectations regarding Capstone Infrastructure Corporation’s (the “Corporation”) future growth, results of operations, performance and business based on information currently available to the Corporation. Forward-looking statements are provided for the purpose of presenting information about management’s current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes.  These statements use forward-looking words such as "anticipate", "continue", "could", "expect", "may", "will", "estimate", "believe" or other similar words.

These statements are subject to known and unknown risks and uncertainties that may cause actual results or events to differ materially from those expressed or implied by such statements and, accordingly, should not be read as guarantees of future performance or results. The forward-looking statements within this news release are based on information currently available and what the Corporation currently believes are reasonable assumptions, including the material assumptions for each of the Corporation’s assets set out in the management’s discussion and analysis of the results of operations and the financial condition of the Corporation (“MD&A”) for the year ended December 31, 2010 under the heading “Asset Performance”, as updated in subsequently filed interim MD&A of the Corporation (such documents are available under the Corporation’s profile on www.sedar.com). Other material factors or assumptions that were applied in formulating the forward-looking statements contained herein include the following: that the business and economic conditions affecting the Corporation’s operations will continue substantially in their current state, including, with respect to industry conditions, general levels of economic activity, regulations, weather, taxes and interest rates; that there will be no unplanned material changes to the Corporation’s facilities, equipment or contractual arrangements, no unforeseen changes in the legislative and operating framework for the Corporation’s businesses, no delays in obtaining required approvals, no unforeseen changes in rate orders or rate structures for the Corporation’s power business, district heating business (“Värmevärden”) or water distribution business (“Bristol Water”), no unfavourable changes in environmental regulation and no significant event occurring outside the ordinary course of business; that there will be a stable regulatory environment and favourable decisions will be received from regulatory bodies concerning outstanding rate and other applications; that the Corporation’s senior credit facility, used to partially fund the Bristol Water acquisition, will be repaid on or prior to its maturity on October 4, 2012; and that Bristol Water will operate and perform in a manner consistent with the regulatory assumptions underlying its current asset management plan (“AMP”), including, among others: a 7% increase in Bristol Water’s 2011/2012 revenue (including a 4% real increase as provided by the UK Water Services Regulation Authority (“Ofwat”) and an approximately 3% inflationary increase), a 3% increase in Bristol Water’s 2011/2012 expenses in line with inflation, UK pound sterling to Canadian dollar exchange rate of £0.625:$1.00, and capital investment, leakage, customer service standards and asset serviceability targets.

Although the Corporation believes that it has a reasonable basis for the expectations reflected in these forward-looking statements, actual results may differ from those suggested by the forward-looking statements for various reasons, including risks related to: power infrastructure (operational performance; power purchase agreements; fuel costs and supply; contract performance; development risk; technology risk; default under credit agreements; land tenure and related rights; regulatory regime and permits; environmental, health and safety requirements; climate change and the environment; and force majeure), the Corporation (tax-related risks; variability and payment of dividends, which are not guaranteed; geographic concentration and non-diversification; insurance; environmental, health and safety regime; availability of financing; shareholder dilution; and the unpredictability and volatility of the common share price of the Corporation); the Corporation’s investment in Värmevärden (general business risks inherent in the district heating business; fuel costs and supply; reliance on industrial customers and ability of residential customers to cancel contracts on short notice; geographic concentration; government regulation; environmental health and safety liabilities; reliance on key personnel; labour relations; enforcement of indemnities against the vendors of Värmevärden; minority interest; and foreign exchange); and Bristol Water’s business (revenue is substantially influenced by price determinations made by Ofwat; failure to deliver capital investment programs; failure to deliver water leakage targets; the imposition of penalties under Ofwat’s new comparative incentive mechanism; the economic downturn impacting the lending environment, as well as debt and capital markets, resulting in more costly financing and inflation negatively impacting leverage and key financial ratios, which may have a negative impact on credit ratings, as well as increasing the cost of capital expenditures; pension plan obligations may require Bristol Water to make additional contributions; failure to meet existing regulatory requirements and the potentially adverse impact of future legislative and regulatory changes; the ability for a Special Administrator to be appointed by the UK Secretary of State for the Environment, Food and Rural Affairs or Ofwat in certain circumstances (including the breach by Bristol Water of its license); foreign exchange; operational risks (including significant interruption of the provision of its services and catastrophic damage resulting in loss of life, environmental damage or economic and social disruption); development of competition within the water sector; reliance on key personnel; default under its Artesian loans, bonds, debentures or credit facility; geographic concentration; potential seasonality and climate change; labour relations; and enforcement of indemnities against the vendors of Bristol Water).

For a more comprehensive description of these and other possible risks, please see the risks set out in the annual information form of the Corporation for the year ended December 31, 2010, under the heading “Risk Factors”, as updated in subsequently filed interim MD&A, the business acquisition report filed June 14, 2011 in respect of the Corporation’s acquisition of Värmevärden and other filings by the Corporation with Canadian securities regulatory authorities (such documents are available under the Corporation’s profile on www.sedar.com). The assumptions, risks and uncertainties described above are not exhaustive and other events and risk factors could cause actual results to differ materially from the results and events discussed in the forward-looking statements. The forward-looking statements within this news release reflect current expectations of the Corporation as at the date of this news release and speak only as at the date of this news release. Except as may be required by applicable Canadian law, the Corporation does not undertake any obligation to publicly update or revise any forward-looking statements.

For further information, please contact:

Aaron Boles
Vice President, Communications and Investor Relations
T: 416-607-5009
Email: aboles@capstoneinfra.com

Michael Smerdon
Executive Vice President and Chief Financial Officer
T: 416-607-5167
Email: msmerdon@capstoneinfrastructure.com