Global investment firm KKR announced that it has signed agreements to enter into a strategic partnership with EGC, an energy service provider based in Düsseldorf, Germany. The engineering service provider ITG is also part of this group.
The founding family and current shareholders retain a stake in the company and will remain active members of the management team. And former CEO Germany of GETEC Group Michael Lowak will join the group as Chairman, contributing his extensive industry expertise to support the management team in this strategic partnership.
With KKR as a strategic partner, EGC looks to become the leading decarbonization partner for the real estate industry and to accelerate its growth. To this end, the company plans to invest more in organic and inorganic growth.
EGC is a second-generation, family-owned, and independent energy services provider in Germany. And te company covers the entire value chain: from planning and developing concepts for energy and building technology systems, to financing, owning and operating central heating units and electricity supply networks, to energy supply.
EGC manages a real estate portfolio of about 2 million square meters for over 100 clients and operates around 800 central heating units. With ITG, a team of experienced engineering employees who plan energy and build technology systems and facilities is also part of the group. This engineering expertise combined with a broad energy services portfolio in particular is the foundation for the group’s strong position.
Buildings account for around a third of global carbon dioxide emissions, mainly through space and water heating. Decarbonizing heating systems in buildings is crucial to achieving the EU’s climate targets. EGC supports landlords in developing solutions to meet their decarbonization goals.
Following the deal’s completion, KKR will support the company in introducing a broad-based employee ownership and engagement model. And the program will ensure that all employees are involved in shaping EGC’s future and can participate in the company’s future success. KKR developed this model in 2011 and has since implemented it globally in 60 portfolio companies with more than 150,000 non-management employees.
KKR has expertise in global infrastructure investments, particularly in the energy sector, and is committed to continuing to invest in the future of renewable energy. With approximately $77 billion in infrastructure assets under management, including over $21 billion invested in the energy transition, KKR brings a global investment perspective, extensive experience in large-scale infrastructure projects, and a proven track record in high-profile transactions in Europe such as Encavis, Vantage Towers, Zenobe, or Greenvolt.
In Germany, KKR has invested over €18 billion of long-term equity in more than 35 companies in various alternative asset classes since the late 1990s, primarily in partnership with founders, family businesses and corporations. This strategic partnership with EGC builds on KKR’s long track record of working with family businesses in Germany.
KKR is funding the investment as part of the Global Climate Strategy, through which KKR is investing at scale in solutions that support the transition to a low-carbon economy.
KEY QUOTES:
“The collaboration with KKR opens up completely new possibilities for us to further expand our strong market position and to develop our group of companies. In KKR, we have found a partner that shares both our strategic goals and our entrepreneurial approach. KKR is not only an established infrastructure investor, but also has a long history of working with family-run companies. We are very much looking forward to this next phase of growth with KKR, which will open up many new opportunities for our group and employees.”
- Corinna Pitz and Dirk Pitz, members of EGC’s management
“EGC enables landlords to efficiently plan, implement and finance the decarbonization of their properties. The company is thus making a significant contribution to both the real estate industry and the energy transition in Germany. I look forward to bringing my experience and industry knowledge to EGC and working with KKR to further drive the company’s growth.”
- Michael Lowak, future Chairman of EGC
“To advance the energy transition in Germany at the necessary pace, we need creative solutions and long-term capital. We are seeing growing interest in contracting solutions and significant potential in what is still a very fragmented market. Together with the management team, we want to develop EGC into the leading decarbonization partner for the real estate industry and drive forward the energy transition in Germany.”
- Ryan Miller, Managing Director in KKR’s European Infrastructure team
