First State fund buys majority stake in Estonian energy firm Utilitas

A €2.1bn European infrastructure fund managed by First State Investments has bought a majority stake in Estonian energy company OÜ Utilitas.

European Diversified Infrastructure Fund II (EDIF II) has bought an 85% stake in the heating network operator for an undisclosed sum. The management team and supervisory board of Utilitas will hold the remaining 15% share in the company.

Utilitas was founded through a management buyout of Dalkia Estonia in 2012. As well as providing district heating services, Utilitas also generates thermal energy and electricity.

Niall Mills, a partner at First State responsible for infrastructure investments, said: “We are delighted that Utilitas is First State’s inaugural infrastructure investment in Estonia.

“Utilitas’ position as the leading operator of a sustainable, reliable district heating network with an increasingly strong focus on renewable energy production is especially attractive to us as a long-term investor.”

Marcus Ayre, a partner, also responsible infrastructure investments at First State, said: “We are especially pleased to have reached agreement with Utilitas today following a period of exclusive bilateral discussions.

Utilitas is EDIF II’s seventh successful investment since its May 2017 series 1 close and brings the total capital committed by EDIF II to over €1.4bn, Ayre said.

“We continue to have a strong pipeline of attractive investment opportunities and are looking forward to a busy 2019,” Ayre said.

First State is the international arm of Colonial First State Global Asset Management, the specialist asset management business of the Commonwealth Bank of Australia.



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