The Finnish majority state-owned energy company Fortum on Thursday signed an agreement to sell its recycling and waste business to the thematic impact investment firm, Summa Equity through its portfolio company NG Group, said Fortum in a press release.
The total consideration on a debt- and cash-free basis is about EUR 800 million.
Based on the balance sheet available at signing, Fortum would record a tax-exempt capital gain of approximately EUR 110 million, however, the final capital gain will depend on the balance sheet value at closing.
The gain will be reported as Items Affecting Comparability in the Other Operations segment’s results once the transaction is closed. The transaction is subject to customary closing conditions and is expected to be completed in the fourth quarter of 2024.
The divestment of the recycling and waste business is part of Fortum’s strategic review of its Circular Solutions businesses.
The strategic review was initiated in August 2023.
The recycling and waste business to be sold comprises municipal and industrial waste management and end-to-end plastics, metals, ash, slag and hazardous waste treatment and recycling services.
These businesses are located in Finland, Sweden, Denmark and Norway and currently employ about 900 employees.
“We are very pleased to have found a very suitable new owner that is well positioned to further enhance and drive future growth opportunities for the recycling and waste business. Next to the clean energy transition, material scarcity is one of the biggest societal challenges we need to solve. Now is the right time for the new owner to take over,” said Markus Rauramo, President and CEO of Fortum.
Founded in 2016, Summa Equity is an impact investor focusing on three thematic areas: Resource Efficiency, Changing Demographics, and Tech-Enabled Transformation.
The purpose of Summa is to invest in solving global challenges. Summa has approximately EUR 5 billion in assets under management and has made over 30 platform investments across three funds raised to date.
Materials account for 22% of the European CO2 emissions.
By combining Summa Equity’s NG Group with Fortum recycling and waste business, we are creating a EU Taxonomy aligned Nordic Circularity champion, enabling the EU 2050 Climate Neutrality and EU 2050 Zero Pollution goals, said Reynir Indahl, Founder and Managing Partner of Summa.
Source: www.dailyfinland.fi