A perfect match
The energy and fibre-optic group SEAS-NVE views the acquisition as a perfect match and a decisive strengthening of the company’s core business areas and skills base.
”It is difficult to restrain our excitement on a day like today. With this acquisition, we have created a historically strong basis for SEAS-NVE. Not only do we get bigger, but most important of all, we get stronger. Volume and scale are needed to operate and develop critical infrastructure, such as the electricity grid, as well as developing large customer portfolios and new smart technological solutions. The acquisition will ensure continued falling tariffs at the same time as we get stronger muscles to drive the energy system in a greener direction”, tells CEO Jesper Hjulmand, SEAS-NVE.
With the acquisition, SEAS-NVE is boosted with 750 employees from Ørsted.
”We share a common vision for a green transition and now, we get a unique opportunity to unite our competencies. We will increase both our skills base and our execution power through the acquisition, and I really look forward to working with competent employees from Radius and Ørsted to operate and develop the electricity grid in Eastern Denmark as well as introduce new services and solutions to our many customers and cooperative members”, says CEO Jesper Hjulmand, SEAS-NVE.
The electricity grid plays a central role in the green transition
The acquisition secures SEAS-NVE the scale needed to further accelerate the green transition. Among other initiatives, this is done by strengthening the energy system to enable it to handle a far more fluctuating electricity consumption and the increasing electricity production from wind turbines, solar panels and other decentral production. At the same time, a comprehensive electrification of the transport sector places new demands on the electricity grid.
”Now, we can speed up precisely this development and make it more cost-effective, because we do so on a larger scale”, predicts Jesper Hjulmand, for whom the match could not be better:
”The Danish electricity grid plays a vital role in the development of our region and society. However, infrastructure requires large and long-term investments. It was a similar situation, when the bridge across the Great Belt was built, and that is the case now when we develop the electricity grid of the future. A development, which due to the acquisition, can now be made faster and more cost-effectively because we do so on a larger scale by creating one energy system in Eastern Denmark”, he tells.
Extraordinary opportunities to invest in the core business
The transaction between SEAS-NVE and Ørsted has a total value of DKK 21.3bn. In recent years, SEAS-NVE has obtained extraordinary financial capacity through among other factors a positive development in the core business and an increase in the value of Ørsted, in which SEAS-NVE holds 9.54 %.
SEAS-NVE extended its shareholding in Dong Energy (now Ørsted) in 2014 and retained the shares in connection with the stock exchange listing of the company in 2016. Now, the company reaps the benefits of that strategy, and the positive development of the shareholding makes it possible to strengthen the core business – for the benefit of its cooperative members and customers. In connection with the acquisition, SEAS-NVE plans to reduce its ownership interest to approximately 5 % over the next 12 months.
The core values are unchanged
In recent years; SEAS-NVE has transformed itself from a traditional electricity company to a group with several business areas, which among others comprise infrastructure for both fibre-optic broadband and electric cars, energy trading within electricity and gas, as well as research in new business opportunities, as for instance energy storage. The transformation is reflected in the group’s financial results. Over the last five years, from 2013 to 2018, revenue has almost doubled from DKK 3.9bn to DKK 7.3bn.
Despite the company’s scaling, the foundation as a cooperative society remains unchanged, chairman Jens Stenbæk stresses:
”The founders of SEAS-NVE were the pioneers behind the electrification of Zealand. Today, our members have power in their sockets 99.99 % of the time. That is record level – also internationally. Our roots are still firmly based in Zealand, and the cooperative movement will always be a part of our DNA. Therefore, we act as a responsible contributor to society, which channels the financial value created back to the region and the cooperative members. This is done through both long-term and sustainable investments in for instance fibre-optic broadband, competitive energy prices, donations and activities benefiting the community. This is also the spirit, in which SEAS-NVE will operate the electricity grid in Eastern Denmark”.
Historic day for the cooperative society
The acquisition is a natural continuation of the historical consolidation of the Danish electricity grid, from which SEAS-NVE has grown and has driven this through mergers and acquisitions, as for instance the acquisition of the electricity grids in Roskilde, Køge, Kalundborg and Sorø – and most recently Vordingborg.
”The primary rationale behind the acquisition is above all to uphold the interests of SEAS-NVE’s cooperative members and customers within energy. Volume and scale are needed to streamline and develop critical infrastructure. The electricity grid in Eastern Denmark originates from four primary companies: SEAS, NVE, KE and NESA, which today is known as Radius. Over the years, all four have grown bigger through consolidation, and today they cover most of Zealand. With this acquisition, we take the next and fully logical step and consolidate the electricity grids into one electricity grid in Eastern Denmark”, says Jens Stenbæk.
The acquisition is subject to the approval by the Danish Competition and Consumer Authority and the Danish Energy Agency, which is expected before the end of the first half of 2020.
SEAS-NVE is a cooperatively-owned energy and fibre-optic group. We uphold the interests of our customers and cooperative members when we create energy to live life.
We work for our customers and cooperative members when we offer ultra-fast internet and secure that there are always power in the sockets and lighting in the streets, and when the grid company Cerius services Denmark’s geographically longest electricity grid. In addition, our aim is to create value for our customers when we store energy from wind turbines for the future and create energy efficient solutions for everyday life.
The SEAS-NVE group goes to the market in its own name and through subsidiaries in different business segments. SEAS-NVE also holds investments within the group’s main activities.
- Cerius A/S (ownership interest: 100 %) – electricity grid company in Western and Southern Zealand and the islands in the area
- Clever A/S (ownership interest: 94.9 %) – e-mobility solutions for the transport of the future – electric cars
- Rødsand 2 Offshore Windfarm AB (ownership interest 80 %) – production of renewable energy
- Fibia P/S (ownership interest: 65.5 %) – fibre-optic broadband on Zealand, the islands in the area and Eastern Jutland
- Energi Danmark A/S (ownership interest 40.5 %) – sale of energy for corporate customers in Denmark and abroad.
- Ørsted A/S (ownership interest 9.54 %) – SEAS-NVE´s historic ownership in energy production
Facts about the business areas acquired:
The transaction includes the following:
- Radius: Supplies approximately 1 million homes and companies in the Copenhagen area, Northern Zealand and parts of Central Zealand via an electricity grid of approximately 19,000 km.
- Consumer business: Sells electricity to approximately 717,000 electricity customers, gas to approximately 105,000 gas customers and heating to approximately 44,000 customers.
- Outdoor lighting business: Operates and maintains approximately 145,000 streetlights.
Publicity manager Morten Kidal, +45 2170 3799, email@example.com