Palamon energises portfolio

The mid-market firm has made its first energy investment with the purchase of Eneas Energy, the 14th investment from its second fund.

Palamon Capital Partners has purchased a 70 percent to 80 percent stake in energy services supplier Eneas Energy. The transaction’s enterprise value was NOK 375 million (£41 million; €47 million), according to a statement.

The 14th investment from Palamon’s €670 million second fund, now more than 67 percent deployed, the deal represents its first energy sector investment.

Founded by chief executive Thomas Hakavik in 1995, Eneas was sold to Norwegian oil company Statoil in 2001, only to be bought back by Hakavik in 2005 with the backing from a group of undisclosed private investors. Palamon will now replace these investors, whilst Hakavik and the management team will continue to lead the company.

Palamon aims to profit from rising energy costs, which could result in more European SMEs – Eneas’ target market – outsourcing energy services in the way that many already outsource IT departments or back-office functions.

“Ageing infrastructure on the one hand, and regulations such as green initiatives on the other, will mean energy prices rising,” said Principal Dan Mytnik, speaking with PEO.  “And in an increasing price market things always happen, so we want to capitalise on that.”

Palamon has made other investments in the Nordic region including financial services firm Nordax Finans, which it exited in April 2010 in a secondary sale to fellow private equity investor Vision Capital for €105 million, making 3.7x its original investment.