US private equity investor KKR has put forward a €2.8bn ($3bn) offer to acquire German renewable energy producer Encavis.  

KKR subsidiary Blitz 21-823 (BidCo) has made an investment agreement to initiate a voluntary public takeover offer for all outstanding free-floating shares of Encavis at an offer price of €17.50 per share.

The offer price is 33% more than the three-month, volume-weighted average share price as of 5 March 2024, and 54% more than Encavis’ closing share price of €11.35 on the same date.

Encavis’ management board and supervisory board have extended unanimous support for the strategic partnership and plan to recommend that shareholders accept the offer.

KKR presented the offer in a consortium that includes the Viessmann Group, a German manufacturer of heating and refrigeration systems, and Abacon Capital, a private equity investor.

The takeover is contingent on reaching a minimum acceptance threshold of 54.3% of all outstanding Encavis shares, alongside standard offer conditions such as regulatory, antitrust and foreign direct investment approvals.

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The transaction will close in Q4 2024.

Encavis will then be delisted from the stock exchange and transitioned to private ownership.

KKR partner and European infrastructure co-head Vincent Policard stated: “Unlocking the full potential of renewable energy requires expertise as well as substantial long-term capital.

“We are pleased that KKR’s strategic investment will provide Encavis with the necessary long-term financial resources at a pivotal time for the company and position it to seize emerging opportunities and solidify its strength in the clean energy landscape. Furthermore, it also contributes to fostering a more energy-independent Europe.”

Encavis has a portfolio of 190 solar photovoltaic and 40 onshore wind farms with a combined 2.2GW operating capacity across ten European countries.

The company has long-term power purchase agreements in place and maintains a multi-year project pipeline.

Encavis management board spokesman and chief financial officer Dr Christoph Husmann stated: “Over the past years, Encavis has grown into one of the leading independent power producers in Europe and has strong ambitions to further continue on this growth path. With KKR and Viessmann, we aim to bring partners on board who share the same long-term and entrepreneurial approach and extensive experience of investing behind the energy transition.

“The offer of €17.50 per share represents an attractive premium for our shareholders. We are convinced that with the additional financial and strategic support, we will be able to leverage our assets and competences and take our business to the next level to compete with the largest European players.”