Target Information

Eurazeo, through its Eurazeo Planetary Boundaries Fund (EPBF), has announced the acquisition of a majority stake in SMP Energies. This transaction marks the second investment of EPBF since the initial closing of the fund in March 2025 and highlights its commitment to deploying profitable environmental solutions at scale to mitigate the effects of exceeding planetary boundaries.

SMP Energies is recognized as France's leading geothermal drilling contractor, renowned for its high-level technical expertise and operational excellence with over 60 wells drilled. The company's success is rooted in its ability to provide clients with a comprehensive turnkey drilling solution, managing all aspects of drilling, maintenance, and well abandonment both in France and abroad.

Industry Overview

In 2023, deep geothermal energy production in Europe reached a record level of approximately 8 TWh across the five largest markets, with a strong increase in demand anticipated, supported by a favorable regulatory framework and the unique advantages of this renewable energy source. Geothermal heat is available continuously, economically competitive, sovereign, and represents a significant lever for decarbonization.

The sustained demand, with anticipated double-digit growth by 2030, is propelled by key end markets, including the large-scale deployment of district heating networks and the development of self-sufficient geothermal solutions for industries and agriculture. This growing momentum is vital in responding to the urgent energy transition needs within the continent.

As the market evolves, companies like SMP Energies are positioned to become pivotal players in the sustainable energy sector. The strengthening of geothermal solutions aligns with broader environmental goals while addressing energy security concerns across Europe.

Rationale Behind the Deal

EPBF's investment in SMP Energies aligns seamlessly with its impact strategy, contributing directly to the preservation of two of the nine planetary boundaries: climate change—through the reduction of carbon emissions from low-carbon energy production—as well as pollution, particularly of soils and groundwater, through well abandonment activities. Moreover, SMP Energies is a pioneer in continuously improving its practices, such as producing more sustainable drilling muds and managing wastewater responsibly, thereby aiding in the preservation of other planetary limits.

Investor Information

Erwann Le Ligné and Wilfried Piskula, Partners and Co-Heads at EPBF, expressed their enthusiasm: “We are very pleased to support SMP Energies’ growth ambitions to accelerate geothermal development in Europe. This second investment from Eurazeo Planetary Boundaries Fund exemplifies our unique investment approach: identifying mid-sized firms to create future champions in environmental solutions. Following the fund's first closing in March 2025, this operation demonstrates our team’s capability to identify the best market opportunities.”

View of Dealert

This acquisition can be considered a strategic investment, as it leverages the growing demand for geothermal energy and the profound need for decarbonization across Europe. By enhancing SMP Energies’ capabilities, EPBF is positioning the company to be a leader in a rapidly expanding market, thus maximizing potential returns.

The commitment to sustainable practices and compliance with planetary boundaries positions SMP Energies as a strong contender for future growth. The combination of favorable market conditions and a clear operational strategy adds layers of resilience to the investment, making it a potentially rewarding endeavor.

In conclusion, this partnership not only aligns with the growing market for renewable energy but also highlights the proactive approach EPBF takes towards managing ecological impact while striving for profitability. Thus, this deal appears to be a promising investment in both financial and environmental terms.

View Original Article