Information on the Target

Norvestor Advisory AS has entered into an agreement to acquire a majority stake in Envera Ltd., the company behind the innovative Smartvatten® solution. Smartvatten serves as a leader in the rapidly growing market for sustainable and responsible freshwater resource management. This solution not only offers significant water and cost savings but also ensures peace of mind for property professionals, property owners, and housing companies.

As a hardware-enabled SaaS enterprise, Smartvatten delivers a comprehensive solution for the real-time monitoring and reporting of water consumption in buildings. By leveraging its advanced algorithm-based software, Smartvatten analyzes data from mechanical, digital, and IoT-enabled water meters to identify consumption patterns and detect leakages. Founded in 2013, Smartvatten now oversees water consumption for over 7,000 buildings across Finland, Sweden, Norway, and the Benelux countries. The company is headquartered in Espoo, Finland and employs approximately 40 individuals.

Industry Overview in Finland

The water management sector is projected to undergo substantial transformation in the Nordic region, driven by the necessity of upgrading aging water utility infrastructures. According to industry experts, water prices in these markets could potentially triple over the next decade, underlining the urgent need for effective water management solutions.

As climate change exacerbates water scarcity issues, there is an increasing imperative for customers to adopt sustainable practices. The Nordic region, characterized by its advanced environmental policies and commitment to sustainability, is witnessing a surge in demand for services that facilitate efficient water usage and management.

Technological advancements, particularly in IoT deployment, are enabling property owners to track water consumption more accurately and take preventive measures against leaks and waste. This increase in efficiency not only aids in conserving vital resources but also supports regulatory compliance for businesses seeking to minimize their environmental impact.

Moreover, with the growing emphasis on circular economy principles, companies operating within the water management sector are well-positioned to capitalize on emerging market trends, demonstrating the broader societal shift towards sustainable resource management in both residential and commercial properties.

Rationale Behind the Deal

This acquisition is strategically significant due to the extensive growth potential offered by Smartvatten's innovative services. Jussi Niiniaho, CEO of Smartvatten, emphasizes the necessity for advanced solutions to combat rising water costs in the Nordic markets. The partnership with Norvestor is expected to accelerate Smartvatten's expansion, further entrenching its position as a leader in the field.

Norvestor's extensive expertise and resources will likely aid Smartvatten in enhancing its market footprint and achieving sustainable growth, addressing the increasing consumer demand for effective water management solutions.

Information About the Investor

Norvestor is a prominent private equity firm specializing in mid-market buyouts within the Nordic region, boasting a history that dates back to 1991. With offices in major Nordic cities, Norvestor has executed 74 investments and over 250 follow-on M&A transactions, underscoring its credibility and success in the industry. The firm focuses on growth companies in the Nordic mid-market, aiming to foster their potential through organic growth and acquisitions, ultimately positioning them for market leadership.

Taaleri, a Finnish financial services company and a current shareholder in Smartvatten, has also expressed enthusiasm for Norvestor's leadership. Taaleri oversees assets totaling EUR 7.4 billion and has a deep commitment to impact investing and circular economy strategies.

View of Dealert

The acquisition of Smartvatten by Norvestor is a compelling investment opportunity, given the increasing demand for sustainable water management solutions. By harnessing innovative technology, Smartvatten is poised to meet the challenges of rising water costs and environmental concerns in the Nordic region.

Additionally, Smartvatten’s established operations and existing customer base present a solid foundation for growth. Coupled with Norvestor’s strategic guidance, the potential for expansion across other Nordic markets and beyond is significant.

Furthermore, the environmental focus of both Smartvatten and Norvestor aligns with global shifts towards sustainability, making this investment not only economically viable but also socially responsible. As water scarcity becomes an ever-pressing issue, companies that prioritize resource efficiency are likely to see enduring demand for their services.

In conclusion, this deal reflects a thoughtful alignment of resources and vision, making it a strategic step forward for both Smartvatten and Norvestor in the competitive landscape of water management.

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