BayWa to sell 49% of renewable unit to fund EIP for $642 million
FRANKFURT: German agriculture group BayWa has agreed to sell 49% of its renewable division to Energy Infrastructure Partners AG (EIP) for 530 million euros ($642 million), sending its shares to their highest level in nearly three years.
EIP, formerly Credit Suisse Energy Infrastructure Partners AG, will make the investment in BayWa r.e. via a capital increase, BayWa said.
“In just a decade, BayWa r.e. has developed into one of the leading companies in the fields of renewable energies – and one that the market values at more than 1 billion euros,” BayWa Chief Executive Klaus Josef Lutz said.
“Today BayWa r.e. is setting the standard for the sustainable development of renewable energy infrastructure offering major growth potential, particularly in Europe, the U.S. and the Asia-Pacific region.”
The transaction, expected to close in the first quarter of 2021, comes as dealmaking in the renewables sector is heating up, driven by stricter emissions regulation and the phase-out of fossil fuels in some parts of the world.
BayWa’s shares rose as much as 4% to their highest level since Jan. 16, 2018.
Sources told Reuters in January that BayWa, an agricultural trading, logistics and services company that is majority-owned by Germany’s cooperative Raiffeisen group, was in advanced talks with Credit Suisse over the deal.
Going forward, BayWa r.e. – which has a pipeline of solar and project of 13.6 gigawatts – will have net debt of 1-1.25 billion euros, the company said.
BayWa r.e. will take the legal form of a German AG, a step Lutz said was taken with a possible initial public offering in mind at some point in the future. He added there were currently no plans for a listing.
BayWa was advised by law firm Latham & Watkins.
($1 = 0.8261 euros)
Source: reuters
