Macquarie to buy 30% of Eastern European gas portfolio

Macquarie Infrastructure and Real Assets has agreed to buy a 30 percent stake in a portfolio of infrastructure assets in Slovakia and the Czech Republic for an undisclosed sum.

The regulated and contracted assets currently belong to EPH, a Czech utility. The group will retain the remaining 70 percent stake in EP Infrastructure, as the unit is called, on completion of the transaction. The latter is expected to close in the first quarter of 2017.

EPH had previously considered divesting 30 percent of EPIF’s assets through an IPO that could have raised €1.6 billion for the group, but later decided to favour a private transaction instead. It is understood that the stake bought by Macquarie, while made up of slightly different assets, will be sold for a little below that number. 

Macquarie declined to comment on deal value.

The deal will be partly funded by Macquarie European Infrastructure Fund 5, the Australian firm’s latest flagship European vehicle, which closed last month on €4 billion. The fund is part of a Macquarie-managed consortium that includes other global investors, the firm said in a statement.

EPIF’s largest holding is in Eustream, Slovakia’s only gas transmission network and a link between Ukraine in the East through to the Czech Republic and Austria in the West. Eustream also provides interconnection with neighbouring countries.

Also in the EPIF portfolio are a regulated gas network and a power distribution network in Slovakia as well as four regulated Czech district heating networks. In addition, EPIF owns controlling stakes in in three underground gas storage facilities in Slovakia and the Czech Republic supported by long-term contracts, Macquarie said.