3i Infra, Goldman buy Finnish electricity grid for €1.54bn

The consortium, which also includes Ilmarinen Mutual Pension Insurance Company, has bought Finland’s second-largest electricity grid and a district heating supplier. The deal is slated to close during the first quarter of 2012.

Swedish energy group Vattenfall announced today that it has sold its Finnish electricity distribution business to a consortium of 3i Group and 3i Infrastructure, Goldman Sachs Infrastructure Partners and Finnish pension Ilmarinen Mutual Pension Insurance Company. 

The deal, worth an enterprise value of €1.54 billion, includes the sale of Vattenfall Verkko Oy, Finland’s second-largest electricity distribution network, and Vattenfall Lampo Oy, a district heating supplier. However, the regulated electricity grid is the most attractive asset, serving about 347,000 retail investors. The deal is expected to close during the first quarter of 2012.

Vattenfall has been steadily shedding assets over the last weeks, the most recent being the sale of its Polish electricity distribution network to Polish utility Tauron Polska Energia for some €819 million. Last month, Vattenfall divested part of its electricity and district heating networks in Hamburg to the city authorities for €463 million.

But this is not the first time the company’s asset sales have attracted the attention of the infrastructure community. In March 2010, Australian investor Industry Funds Management (IFM) bought a 40 percent stake in Vattenfall’s German electricity grid – the third-largest in the country – in a deal that valued the network at €800 million.

Vattenfall has been selling non-core assets to help cut its debt pile, which stood at around €15.6 billion at the end of the first half of the year, according to a company report.