Arcus European Infrastructure Fund 2 has completed an investment in renewables asset manager Momentum Energy Group.
The fund has acquired the stake in Momentum from the founder of the company in a bilateral transaction and will own the majority of the business alongside the founder and key management.
Momentum is a full scope provider covering all aspects of asset management of solar and wind projects during the entire value chain, and each phase of the asset’s technical and economic lifetime.
It provides services comprising planning, construction, operational, asset life extension, repowering, decommissioning and sales and sourcing of projects.
Momentum owns a portfolio of 169 onshore turbines with an installed capacity of about 130MW.
The portfolio has a capacity-weighted average age of 20 years and is being acquired in part due to its repowering and lifetime extension potential for up to 300MW.
Momentum also has a greenfield renewal energy development pipeline of 600MW across Denmark and Germany, predominantly onshore wind and some solar, and the potential to repower an offshore/nearshore wind site in Sweden for up to 70MW.
Momentum also manages a portfolio of around 200 external asset management contracts under short-term rolling arrangements.
Arcus managing partner and head of origination Ian Harding said: “We are extremely pleased to announce our investment in Momentum.
“This marks our eighth investment for AEIF2 and the third investment in the energy sector.
“The investment in Momentum represents a strong fit with the Fund’s investment strategy of targeting mid-market, value-add infrastructure businesses in Europe with a strong ESG profile.
“Acquiring a renewable energy business adds another dimension to the fund portfolio and demonstrates Arcus’ ability to use our strong sector knowledge to identify and invest in high quality infrastructure businesses.”
Arcus partner and head of energy origination Stefano Brugnolo, who led the transaction, said: “The Origination Team has for more than two years been actively exploring potential investments in the European wind segment, an area that offers large opportunities to maximise the value of existing renewables capacity.
“In early 2021, the Arcus Energy Origination team identified Momentum as an experienced operator with a unique mix of skills that makes it an ideal entry point for a value-add investment strategy.
“We secured a period of exclusivity and worked effectively to diligence the business and execute on a bilateral basis.
“We are delighted to be working with Kim and the senior management of Momentum on the future growth of the business to consolidate the fragmented market and undertake repowering, upgrade, lifetime extension and scale opportunities.”
Momentum chief executive Kim Madsen said: “We are delighted to get Arcus onboard as our new majority shareholder.
“Momentum has grown rapidly over the last few years, growing from 23 employees to over 65 employees in just the last 18 months.
“To be able to continue this strong growth also in the years ahead, keeping Momentum as a key player in a more fragmented and mature renewable energy market, it was necessary to bring more international and financial resources onboard, if we are to release Momentums full potential.
“I am proud of my team and on my own behalf, that Arcus decided to go all the way by investing a majority stake in Momentum, but also to team up with my colleagues and me, trusting that we are the right platform to grow from, to participate in forming a greener future for all of us.”