DG Infra, the Benelux-focused infrastructure fund manager, has agreed to provide long-term financing that will allow Dutch thermal energy business Eteck to expand in a “rapidly changing” market for renewable energy systems in the Netherlands.
Eteck is a specialist in thermal energy storage, a method of storing energy in the ground for use in heating and cooling buildings. It is an efficient form of energy consumption targeted at large offices, residential areas comprising 30 to 50 homes, greenhouses and industrial parks.
There appears to be an opportunity for smaller players to move into the market as a result of large energy companies, housing corporations and governments increasingly vacating the space. According to a DG Infra press release, this is due to “a lack of scale, lack of specialised knowledge, systems with sub-optimal efficiency, or lack of capital”.
Eteck already operates more than 80 thermal energy storage (TES) systems, including some it has acquired from major energy companies and governments, and says it expects to make more acquisitions in the coming period. The agreement with DG Infra will give it “the flexibility it needs to acquire existing TES systems and develop and build new projects”.
Chrisbert van Kooten, an investment director at DG Infra, said it was making long-term financing available to Eteck “so that it can acquire projects which for us are often too small as an investment opportunity”.
Cees Verloop, general manager of Eteck, added that “combining Eteck’s operational and commercial expertise with DG Infra’s financial strength will play an important role in transforming and consolidating the TES market”.
Kempen Corporate Finance acted as financial adviser to Eteck on the deal, while Eversheds Faasen Advocaten, 3E and Innoforte all acted as financial advisers to DG Infra.
DG Infra’s funds – DG Infra+ and DG Infra Yield – make investments in infrastructure and infrastructure-related assets, public-private partnerships and selected real estate. Between them, they have €300 million available for investment.
DG Infra – which has three Belgian offices in Antwerp, Brussels and Liege and a Dutch office in The Hague – is a joint venture between Belgian private equity firm Gimv and Belgian bank Belfius.