Fortum to acquire circular economy company Ekokem - purchase price EUR 700 million

Fortum to acquire circular economy company Ekokem - purchase price EUR 700 million

May 27, 2016
Energy & resource efficiency

Fortum Corporation and the four biggest owners of Ekokem Corporation have announced today that they have signed an agreement whereby Fortum will acquire their shareholdings in Ekokem. These four biggest owners are the Finnish State, the Association of Finnish Local and Regional Authorities, Ilmarinen Mutual Pension Insurance Company and the Helsinki Region Environmental Services Authority, HSY, who represent approximately 81% of the shares and voting rights. In total, Ekokem has about 400 shareholders.

The transaction will require competition authority clearances in Finland and in Sweden. Fortum estimates that the closing of the transaction will take place during the third quarter of 2016. Fortum has also announced that it will make a tender offer to all remaining shareholders at the same price (EUR 165 per share). The completion of the tender offer will be subject to Fortum obtaining the competition clearances and reaching a majority ownership in Ekokem. Having reached the necessary ownership thresholds, Fortum will proceed with a minority redemption process. The debt and cash-free purchase price for 100% of the company is EUR 700 million.

"During the last years, Ekokem has grown from a Finnish company into a Nordic environmental management service group. Our growth has been profitable, and the market offers plenty of opportunities to grow the business further. One example of our current growth initiatives is the Circular Economy Village that is currently being built in Riihimäki and which will refine recycled plastics, biogas and energy, among other things, from mixed municipal waste," says Ekokem CEO Karri Kaitue.

"Ekokem is a first-class company with experienced management and personnel. Supported by Fortum’s competence in waste-to-energy and strong financial resources, a true Nordic circular economy champion will be formed. We see excellent international growth opportunities for the business and intend to invest in the further development of Ekokem’s solutions," says Pekka Lundmark, Fortum President and CEO.

Image: Ekokem

Source: Ekokem

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