Switzerland's Energy Infrastructure Partners (EIP) will acquire a majority stake in BayWa AG's renewable energy unit, BayWa r.e., by implementing a capital increase. This move will reduce the German agricultural group's ownership from 51% to 35%.
EIP had previously expressed interest in raising its stake in BayWa r.e. to 70-80% from 49%, aiming to relieve financial strain on BayWa and enhance the creditworthiness of its renewables division.
EIP plans to inject 150 million euros of fresh capital into BayWa r.e. to realign the company's focus on developing and operating renewable energy projects on a global scale.
BayWa AG, in a separate announcement, disclosed that it would waive 350 million euros in shareholder loans to BayWa r.e.
Matthias Taft, CEO of BayWa r.e., praised EIP as a strategic, long-term partner with profound expertise in the energy sector. Taft underscored the aim of optimizing operations, boosting profitability, and fortifying the company's competitive position over the long haul.
The capital increase and debt financing secured will address BayWa r.e.'s additional capital and guarantee requirements, totaling approximately 435 million euros until 2028, as outlined in BayWa AG's statement released on Sunday.
EIP, managing 7.5 billion euros in energy infrastructure, initially paid 530 million euros for a 49% stake in BayWa r.e. in late 2020.
EIP has enlisted advisory firm Ziems und Partner to facilitate the company's transition, expressing confidence in BayWa r.e.'s capabilities and its pivotal role in advancing the energy transformation.
(Note: 1 euro is equivalent to 1.0476 USD)