Partners Group is buying a district heating platform in the Baltics from Finnish energy company Fortum Corporation in an €800m deal.
The global private markets firm, investing on behalf of its clients, has agreed to buy District Heating Platform, a company that delivers heating to thousands of homes and businesses across Estonia, Latvia and Lithuania.
The platform has 74 generation assets, which generate a heat capacity of 881MW and power capacity of 130MW across 387km of district heating networks. The platform’s fuel is largely derived from renewable or recycled sources, mainly biomass.
Partners Group said it will work with the management team on a value creation plan that seeks to transform the company from a portfolio of attractive district heating assets into an independent customer-centric residential and industrial energy solutions provider.
David Daum, managing director, private infrastructure Europe, Partners Group, said: “Through providing sustainable heating, this district heating platform is contributing to the decarbonisation of our economies, one of the three giga themes that Partners Group focuses its investment activity on.
“This investment reflects Partners Group’s continuing commitment to transformational investing in assets that have meaningful impact on the communities in which they operate.”
Daum said the company delivers heating to thousands of homes and businesses across the Baltic region, an area known for the severity of its winters.
“Looking ahead, a key area of focus for us will be executing strategic acquisitions that we have identified, as well as the development of several greenfield projects.”
Fortum said the total consideration on a debt- and cash-free basis is €800m, adding that the disposal is a continuation of Fortum’s strategy execution, whereby Fortum continuously reviews its businesses to optimise its portfolio for value creation.
Last year, Fortum divested the district heating businesses in Joensuu and Järvenpää, in Finland.
The strategic reviews of the heating and cooling businesses in Poland, its 50% stake in Stockholm Exergi, and the Consumer Solutions business are currently ongoing.
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