Information on the target
Quaero Capital has successfully acquired a 49% stake in UAB Vilniaus kogeneracinė jėgainė (Vilnius CHP), a prominent operator of a Waste-to-Energy (WtE) and Combined Heat and Power (CHP) plant, which is primarily owned by Ignitis Group. The facility boasts a total power capacity of 93 MW and a heat capacity of 239 MW, making it a critical infrastructure asset for the region. Vilnius CHP plays a vital role in meeting the annual central heating demand for the city of Vilnius, providing essential services to approximately 230,000 households.
The acquisition values 100% of Vilnius CHP's equity at EUR 244 million, with the stake acquired by Quaero Capital amounting to EUR 120 million. This investment includes a fixed payment of EUR 110 million and an additional conditional earn-out payment of EUR 10 million, which is contingent upon the future performance of Vilnius CHP. The transaction is pending regulatory approvals before finalization.
Industry overview in the target’s specific country
The energy sector in Lithuania has undergone significant transformation in recent years, driven by a combination of regulatory reforms, increased investment in renewable energy, and a commitment to reducing carbon emissions. The government has prioritized the development of sustainable energy sources, including biomass, wind, and solar power, while also enhancing the efficiency of existing energy infrastructure. This shift is aligned with the European Union's broader goals of achieving climate neutrality by 2050.
Waste-to-Energy (WtE) plants, such as Vilnius CHP, are increasingly recognized as essential components of Lithuania's energy strategy. They not only help manage waste but also contribute to energy generation and reduce reliance on fossil fuels. The integration of WtE technology into the energy mix supports the country's objectives of enhancing energy security and sustainability.
The Lithuanian energy market is characterized by a growing demand for both electricity and heat, particularly in urban areas. As cities expand and populations increase, the need for reliable and efficient energy solutions becomes more pressing. Vilnius CHP's ability to provide both electricity and heating services positions it strategically within this evolving landscape, ensuring that it meets the needs of the community while adhering to environmental standards.
Furthermore, the regulatory environment in Lithuania is becoming increasingly favorable for investments in energy infrastructure. The government is actively encouraging private sector participation through various incentive…