EMEA: Allianz led consortium snaps up Elenia

13 December 2017 - 12:00 am UTC

A consortium of Allianz Capital Partners (45%), Macquarie Infrastructure & Real Assets (45%) and Valtion Eläkerahasto (VER), (the State Pension Fund of Finland) (10%), have agreed to buy Elenia, they announced on Wednesday (13 December).

The enterprise value of the Finnish grid and district heating company is EUR 3.6bn, Inframation understands.

This is more than 20x Elenia’s 2016 EBITDA of EUR 176.3m.

The EBITDA for the first six months of 2017 was EUR 96.9m up 7.9% on the same period in 2016. The company has a 55.3% EBITDA margin.

The consortium was advised by Macquarie Capital and ICECAPITAL (financial), and Clifford Chance and Ditmar (legal).

The sellers were Goldman Sachs Infrastructure Partners (45%), 3i Infrastructure (39.3%), the Mutual Pension Insurance Company Ilmarinen (10%) and US insurer TIAA CREF (5.6%). They were advised by Citi and Goldman Sachs (financial), and Allen & Overy and Avance Attorneys (legal).

Seller 3i said it would receive GBP 725m from the sale. This is more than three times the GBP 195m it paid to acquire the company in 2012.

Financial close is expected in 1Q2018.

For Macquarie, the asset forms part of its supercore platform, which targets IRRs in the low single digits. Its first investment was UK gas distribution company Cadent.

Elenia Networks, the electricity distribution business, serves 420,000 in 100 municipalities in central Finland, a market share of approximately 12%. The grid is 69,000 km in length.

Elenia Heat owns and operates 16 local district heating networks across Finland, with a total network length of almost 500 km and around 85,000 end-users.

Elenia has EUR 1.4bn of debt, in listed and private bonds.