IFM-owned firm completes $473m Polish heating deal

The Australian fund manager’s portfolio company, Dalkia Polska, has acquired an 85% stake in SPEC from the City of Warsaw. SPEC, the largest district heating network in the EU, increases Dalkia Polska’s market share in the Polish district heating sector from 11% to 25%.

Dalkia Polska, a portfolio company of Australian fund manager Industry Funds Management (IFM), has completed the acquisition of an 85 percent stake in Przedsiebiorstwo Stolecze Energetyki Cieplnej (SPEC) from the City of Warsaw in Poland. 

The deal was announced earlier this year but has now received final approvals from the City Council of the City of Warsaw and the European Union (EU). According to a statement from Gide Loyrette Nouel, a French law firm which advised Dalkia Polska on the deal, the purchase price was PLN1.44 billion (€343 million; $473 million).    

SPEC is the largest district heating network in the EU, with more than 1,700km of pipelines supplying more than 80 percent of the buildings in Warsaw. District heating is a system for distributing heat generated in a centralised location for residential and commercial heating requirements. The acquisition means that Dalkia Polska increases its share of the Polish district heating sector from 11 percent to 25 percent.

IFM’s involvement in Polish district heating dates back to March 2006 when it acquired a stake in Dalkia Lodz. This stake was effectively transferred over when IFM than acquired a 40 percent stake in Dalkia Polska in a $520 million deal in July last year.

Frederic Michel-Verdier, an executive director at IFM, said that “in terms of larger acquisitions, this is probably the last one” that will be made by Dalkia Polska in the forseeable future, although “smaller deals will be looked at”.

IFM has completed 40 infrastructure deals globally since 1995 and has $10 billion invested in the asset class through its global and Australian open-ended funds. According to Infrastructure Connect, investors in its 2004-vintage IFM International Infrastructure Fund included AustralianSuper, Catholic Superannuation Fund, FirstSuper and Vision Super.