OSLO, NORWAY: An industrial partnership of Hafslund Eco, Infranode and HitecVision has entered into an agreement with Fortum to purchase Fortum’s 50 per cent share in Fortum Oslo Varme.
As part of the transaction, the City of Oslo will transfer its 50 per cent stake in Fortum Oslo Varme to Hafslund Eco. Following the transaction, Hafslund Eco will become the majority owner with 60 percent ownership in Fortum Oslo Varme, while Infranode and HitecVision will own 20 percent each.
The transaction means that Hafslund Eco increases its energy production by almost 2 TWh annually and secures ownership to critical infrastructure that delivers important services to the people in Oslo. District heating are attractive assets with a lower underlying risk than the hydropower business and fits in very well with Hafslund Eco’s existing renewable portfolio. Through its ownership in Eidsiva Energi, Hafslund Eco currently owns district heating business in Innlandet county.
The partnership has a clear goal of realizing the project for carbon capture (CCS) at Klemetsrud, which will continue with undiminished strength.
The transaction entails a consideration for Fortum Oslo Varme of approximately NOK 20 billion on a 100 per cent enterprise value basis. Upon completion, the partnership will buy 50 per cent of the shares for approximately NOK 8 billion and repay NOK 2 billion in shareholder loans to Fortum, which implies a payment for Hafslund Eco of approximately NOK 2 billion. The shares from Oslo Municipality will be transferred to Hafslund Eco as a property contribution, and Hafslund Eco will take over NOK 2 billion in shareholder loans from the City of Oslo.
The transaction has been approved by the companies involved and must now also be approved by the Oslo City Council and by the Norwegian Competition Authority before it can be carried out.
Fortum Oslo Varme is currently owned by the City of Oslo and Fortum (50/50) and is Norway’s largest producer of district heating and supplied 36% of district heating generated in Norway in 2021. The company obtained a comparable EBITDA of NOK 897 million and sold 1.8 TWh of district heating and 0.1 TWh of electricity in 2021. Fortum Oslo Varme has approximately 200 employees.