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Generator takeover

Aggreko acquired for £2.3bn by private equity groups

Aggreko

Aggreko supplies power to events

Temporary power generator Aggreko and Albion Acquisitions, a vehicle for private equity firms I Squared Capital and TDR Capital, have recommended an all cash takeover valuing the Glasgow company at £2.32 billion.

The offer at 880p per share represents a premium of approximately 39% to the closing price of 635p on 4 February, the last business day before the commencement of the offer period.

Aggreko’s final dividend of 10p per share will be payable.

Directors of the company, which provides temporary generation for events such as the Olympic Games and pop concerts, intend to recommend unanimously that shareholders vote in favour of the offer. The acquisition is expected to become effective in the summer.

The bid was announced as expected on deadline day but followed speculation yesterday of a rival offer.

Shares in the company rose 8% after newswire Bloomberg reported that Platinum Equity had indicated an interest in turning the bid into an auction. Aggreko shares this morning were trading as high as 905p, significantly above the offer price and possibly in anticipation of a rival bid.

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In today’s statement, Aggreko chairman Ken Hanna said: “The Aggreko board believes that the offer from I Squared Capital and TDR Capital represents an attractive price in cash that fairly recognises Aggreko’s future prospects.

“We believe that the business, its people and customers will continue to be well supported with I Squared Capital and TDR Capital as shareholders bringing their expertise in energy and rental markets to support our existing strategy.

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“Aggreko is a great company and the actions that we have taken in the last few years, both strategically and financially, have positioned the company well to navigate the market challenges and look to the future as a leader in the energy transition.

“The leadership team set out a clear vision in November 2020 for how Aggreko can both grow profitably through the energy transition and achieve market leading carbon reduction targets. This strategy was well received by our partners, our customers and investors, and I Squared Capital and TDR Capital are fully supportive.

“I am proud to have been chair of Aggreko for the last nine years and it has been a pleasure to work with so many dedicated individuals who have made Aggreko a leader in the field of temporary power solutions. For now, it is business as usual, and I thank all our people for their continued dedication and hard work.”

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Adil Rahmathulla of I Squared Capital, said: “Aggreko is a global market leader in delivering bespoke temporary power solutions to its customers and has clearly shown it has a strategy to complete its journey towards a net-zero emission business.

“The urgency to deliver on that transition has only increased in the post-Covid environment. Repositioning Aggreko fast enough to truly capitalise on these trends and rapidly shifting customer demand requires significant investment in clean technology and a step change in the pace of transformation.

“We are well positioned to accelerate Aggreko’s development at this critical juncture and secure a successful future for the company, underpinned by a long-term investment focus and the combined expertise of TDR Capital and I Squared Capital in the power infrastructure and equipment rental sectors.”

Gary Lindsay of TDR Capital, said: “I Squared Capital and TDR Capital together have a proven track record and deep expertise in investing in the power infrastructure and equipment rental sectors.

“Aggreko is a business that fits this investment focus well. It has the potential to enable the energy transition through clean technology investment, as the world focuses increasingly on energy efficiency and sustainability.

“We fully support Aggreko’s vision for long term growth and believe our partnership will enable it to accelerate its strategy. We look forward to partnering with Aggreko’s management and employees to further support the company’s ongoing transformation towards a clean energy future.”



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