Kohlberg Kravis Roberts (KKR) has announced plans to take over German renewable energy platform and independent power producer (IPP) Encavis in a deal worth around €2.8bn.

In this connection, Blitz 21-823, a holding company controlled by investment funds, vehicles and accounts advised and managed by KKR and its affiliates (KKR), will launch a voluntary public takeover offer for the German wind and solar park operator.

Listed on the MDAX of the Deutsche Börse, Encavis acquires and operates onshore wind farms and solar parks in 12 European countries. Encavis is part of the larger Encavis Group and currently has a power generation capacity of nearly 2.2GW.

As part of the takeover offer, KKR has signed an investment agreement with Encavis to form a strategic partnership to support the latter’s long-term growth.

Viessmann, a German manufacturer of heating and refrigeration systems, will invest as co-investor in a KKR-led consortium.

KKR will offer a cash consideration of €17.5 per share for Encavis’ shareholders.

The global investment firm has also inked binding agreements with Abacon Capital and several existing shareholders, representing about 31% of the total share capital of Encavis. These existing shareholders will remain indirect long-term investors in the German renewable energy firm.

According to Encavis, the consideration represents a 54% premium to its XETRA closing share price on 5 March 2024.

Encavis chief financial officer Christoph Husmann said: “With KKR and Viessmann, we aim to bring partners on board who share the same long-term and entrepreneurial approach and extensive experience of investing behind the energy transition. The Offer of €17.5 per share represents an attractive premium for our shareholders.”

Through the partnership with Encavis Group, KKR intends to accelerate growth in all segments of the former. The latter will also provide significant financial support to strengthen Encavis’ project pipeline, increase capacity additions, and facilitate expansion in new markets.

KKR aims to achieve 7GW of installed capacity for the German firm by the end of 2027 with continued growth thereafter.

KKR partner and European infrastructure co-head Vincent Policard said: “We are pleased that KKR’s strategic investment will provide Encavis with the necessary long-term financial resources at a pivotal time for the Company and position it to seize emerging opportunities and solidify its strength in the clean energy landscape.

“Furthermore, it also contributes to fostering a more energy-independent Europe.”

Contingent upon meeting various conditions, such as obtaining official approvals for foreign investment, merger clearances, and holder control proceedings, the takeover is anticipated to conclude in Q4 2024.