• EQT Infrastructure acquires Swedegas from E.ON Ruhrgas, Statoil, DONG Energy and Fortum
• Swedegas is the owner and operator of the largest part of Sweden’s gas transmission network located in southern and western Sweden
• Swedegas is an essential part of Sweden’s energy infrastructure and plays a vital role in the supply of both energy and industrial feed stock in the region
The EQT Infrastructure Fund (EQT Infrastructure) will acquire all of the share capital in Swedegas from the existing four owners; E.ON Ruhrgas, Statoil, DONG Energy and Fortum. Swedegas owns and operates the largest part of the Swedish high-pressure gas transmission network, located in southern and western Sweden. The investment is the fund’s third and the first investment in Sweden.
“We are very happy to have EQT Infrastructure as a new independent and dedicated owner of this important infrastructure. We believe EQT Infrastructure has all the requirements to continue to develop the company towards a key position in the Swedish gas market,” says Lars Gustafsson, CEO of Swedegas.
Swedegas owns the largest part of Sweden’s gas transmission network with a total length of 390 kilometers. Revenues in 2008 were approximately SEK 218 million. Swedegas is regulated by the Swedish Energy Markets Inspectorate and holds government concessions for its network.
Swedegas transports gas in its network from Dragør, the only interconnection of Sweden with Denmark and the extended European gas transmission network. In the future this infrastructure can play a key role when developing the Swedish biogas potential.
Although only around 2% of Sweden’s total energy supply comes from gas, in the southern and western parts of Sweden covered by the gas transmission network, it accounts for about 20%.
”We are thrilled to make this investment, which fits very well with the fund’s investment strategy. In addition to promoting the stability and development of the gas market including existing customer relationships, we see interesting potential in supporting industries to replace oil with gas as fuel and also in meeting the increasing demand for vehicle gas. Transporting biogas is another promising opportunity,” says Stefan Glevén, Director at EQT Partners, advisor to EQT Infrastructure.
By replacing oil with energy gas, the emission of the greenhouse gas CO2 can be reduced by more than 25%. Similarly vehicles running on energy gas instead of petrol or diesel have much lower emissions of CO2.
Ownership and board of directors
The transaction will be financed by equity and debt, and EQT Infrastructure will together with the Board of Directors and management own 100% of the equity interests in Swedegas. The investment is financed by approximately half equity and half by bank loans provided by Nordea Bank AB and Skandinaviska Enskilda Banken AB. In agreement with the sellers no further financial details will be disclosed at this stage.
The new board of directors will include the following members from the EQT network of industrialists:
• Lars Frithiof, ex CEO E.ON Sverige
• Kurt Håkansson, ex SVP ABB, ex EVP Areva (Alstom)
• Pär Nuder, ex Minister of Finance, Sweden
Nordea Corporate Finance acted as exclusive financial advisor to EQT Infrastructure and Vinge acted as legal advisor to EQT Infrastructure in the transaction. The transaction is subject to certain conditions and is expected to close during Q1 2010.
Contacts: EQT Partners
Lennart Blecher, Senior Partner +41 43 244 81 95 or +41 79 679 46 91
Stefan Glevén, Director +46 8 506 55 316 or +46 733 902 316
Johan Hähnel, Communications & PR +46 8 506 55 334
EQT is a group of leading private equity funds with investments in Northern Europe, Central and Eastern Europe, USA and Asia. EQT manages funds active within buy-outs, growth financing and infrastructure. EQT deploys a unique industrial approach to investing, utilizing a vast network of industrialists to identify and develop companies. EQT’s model is based on clear corporate governance. The EQT funds mainly acquire or finance market leaders with considerable growth potential.
EQT acts as a catalyst for change in the companies that the funds invest in. The companies develop into market leading players through genuine and sustainable operational improvements. EQT has raised approximately EUR 13 billion in 12 funds, which have invested approximately EUR 7 billion in more than 70 companies. EQT owned companies have more than 500,000 employees.
Since EQT’s first acquisition in 1995, the average annual growth in its portfolio companies has been 13%, the number of employees has increased by 12% and earnings by 20% annually. More than 90% of the value creation is attributable to growth, strategic repositioning and increased earnings.
EQT Infrastructure is a EUR 1,200 million fund (launched 2008) investing primarily in existing infrastructure and has the flexibility to invest globally. Potential targets are basic infrastructure, concession-based infrastructure, social infrastructure and infrastructure-related services.
EQT Partners is advisor to all EQT funds and has more than 100 investment professionals with an extensive industrial and financial competence. EQT Partners has offices in Copenhagen, Frankfurt, Helsinki, Hong Kong, London, Munich, New York, Oslo, Shanghai, Stockholm, Warsaw and Zurich.
More information about EQT can be found on www.eqt.se
Swedegas owns and operates the gas transmission pipeline from Dragør in Denmark to Stenungssund, 50 km, north of Gothenburg. The company's main direct customers are distribution companies. Swedegas also offers services associated with new connections to the pipeline, transporting gas and the development of the network.
Swedegas annually transports approximately 900 million m3 of gas. This is equivalent to 10 TWh, and around 2% of Sweden's total energy needs. Gas used in Sweden comes from the Danish North Sea fields. Swedegas had a turnover of 218 million Swedish kronor in 2008. The company has 24 employees.