Estonia-headed renewable energy company Enefit Green ÖU has announced that it has signed a sales and purchase agreement with compatriot wood pellet producer Warmeston OÜ for its combined heat and power, and wood pellet plant complex in Latvia.
According to the agreement signed on December 29, 2023, Enefit Green has sold its Brocēni biomass-fired combined heat and power (CHP) plant and the neighbouring wood pellet plant to Warmeston.
Commissioned in 2016, the Brocēni facility has 39 employees, and the electricity produced is sold to the Latvian electricity grid, while the heat is used to dry raw materials in the adjacent wood pellet plant.
The annual production capacity is about 160,000 tonnes, and the pellets are sold to energy companies, wholesale distributors, and retail clients.
Increasing the share of wind and solar energy in the Baltic States and Poland is the focus of Enefit Green. Currently, we have six wind parks under construction in Finland, Estonia, and Lithuania, as well as four solar power plants in Estonia, Latvia, and Poland with a total capacity of 715 megawatts. The sale of biomass-based cogeneration businesses allows us to focus more on our strategic business direction. The professional team at Brocēni is a valuable foundation for Warmeston’s growth. We thank the team for their contribution and wish them success in the future, said Innar Kaasik, Member of the Management Board and Production Manager of Enefit Green.
Following the transaction and asset transfer, the Brocēni CHP plant, pellet factory, and employees will continue their existing activities within the Warmeston group.
The value of the transaction on a cash- and debt-free basis is EUR 32 million. Enefit Green was advised by LHV as a financial advisor, KPMG for financial due diligence, and TGS Baltic as a legal advisor.
Warmeston was advised by Superia Corporate Finance and Cobalt. Swedbank Estonia provided financing for the transaction.
Warmeston currently operates four pellet production facilities in Estonia with a combined annual capacity of around 460,000 tonnes.