InfraVia in Finnish electricity deal

The Paris-based fund manager has agreed to acquire distribution network Kilpilahden Sahkonsiirto from Neste Oil Corporation.

French fund manager InfraVia has agreed to acquire a 100 percent stake in Finland’s Kilpilahden Sahkonsiirto (KS), the regulated electricity distribution network for the Kilpilahti industrial area, from Finnish oil refining firm Neste Oil Corporation.

Funding for the deal, the size of which is undisclosed, will come from InfraVia’s European Fund II, which reached a final close in January on €530 million. The transaction is expected to close during the first quarter of 2015.

With 2,000 GWh (gigawatt hours) of distributed energy per annum, KS is one of the largest industrial distribution networks in the Nordic region. Neste Oil, which is majority owned by the Finnish state, is the main counterparty through the Porvoo refinery, which has total annual production of 12.5 million tons.

In the next few years, the network will require significant investment to improve the security and reliability of electricity distribution to industrial companies.

“Our investment in KS is a clear illustration of our strategy to assemble over time a Nordic portfolio of similar assets and build a regional platform servicing key industrial partners,” said Vincent Levita, founder and chief executive officer of InfraVia, in a statement.

Towards the end of 2013, InfraVia acquired Roytta Industrial Grid (RIG), another Finnish electricity distribution network located in Tornio in Lapland.

Danskebank and Roschier provided financial and legal advice respectively on the latest transaction.

The deal follows InfraVia’s purchase of a 20 percent stake in Noordgastransport, a Dutch gas transportation system, last month. The second fund has also invested in the A8 motorway in Germany, a regulated gas distribution business in Bordeaux, and the Tempo public-private partnership in France.