Estonian renewables company Enefit Green AS (TAL:EGR1T) said on Wednesday that it has agreed to sell its district heating operations in Paide, Estonia, and Valka, Latvia, in an effort to pursue growth in the wind and solar energy sectors in the region.
Estonian renewable power and heat producer Utilitas is set to become the new owner of a group of facilities in a transaction valued at EUR 15.8 million (USD 17.4m) on a cash- and debt-free basis.
Under the terms of the agreement, Enefit Green will sell to Utilitas a cogeneration plant, a biomass boiler house, a reserve boiler house and a solar farm in Paide. This business units employs a team of 21, and sells thermal energy to 226 buildings.
The district heating business in Valka includes a cogeneration plant and reserve boiler houses built in 2012 and a team of 12 employees. The city of Valka sells the plants’ thermal energy to customers.
The transaction requires approval from Estonian and Latvian competition authorities. Once the deal is finalised, Enefit Green will hand over all Paida and Valka assets, services, partnerships and employees to the Utilitas Group.
“We wish to keep the focus on Enefit Green’s strategic business direction, which is to increase the share of wind and solar energy in the Baltics and Poland,” commented Innar Kaasik, Member of the Management Board and Production Manager of Enefit Green. “As of today, we are already the largest wind energy producer in the Baltics and have successfully expanded the production of solar energy in recent years. We have a strong short- and long-term development portfolio, which we will focus on going forward”.
Robert Kitt, head of district heating companies at Utilitas, added: “As the largest district heating company in Estonia, we see that both Paide and Valka fit very well into our district heating portfolio with their district heating systems based on renewable sources. These assets have been constantly invested in, they are well managed and in good condition. It is a great pleasure that we will have the opportunity to provide services in these cities in the future.”
(EUR 1.0 = USD 1.099)
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