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GasNet, the largest gas distributor in the Czech Republic, is for sale

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GasNet, the largest gas distributor in the Czech Republic, is being put up for sale, according to a report in today’s Hospodářské noviny (HN). The sale process is being initiated by a consortium of investors led by Macquarie Asset Management (MAM), as confirmed by sources from the financial, consulting, and energy sectors. The company’s valuation is estimated to be in the higher tens of billions of Czech crowns.

GasNet is responsible for supplying natural gas to households and businesses across the Czech Republic, excluding Prague and the South Bohemia region. It manages an extensive network of pipelines spanning 65,000 kilometers and serves over 2.3 million customers.

The sale process will be coordinated from London, where the consortium of investors, led by Australian company MAM, is headquartered. The consortium also includes British Columbia Investment Management Corporation and Allianz Capital Partners. However, all parties involved declined to comment on the sale, according to HN.

In 2019, the consortium acquired a majority stake of 50.04 percent from German energy group RWE for 1.8 billion euros (equivalent to CZK 46.2 billion at the time). RWE had valued the company at 3.6 billion euros (approximately CZK 85 billion based on the current exchange rate). Macquarie had previously held just under half of GasNet, having initially acquired 35 percent in 2013 and gradually increasing its ownership. Presently, the consortium is the sole owner of GasNet.

Patria Corporate Finance director Petr Dědeček explained that the increased number of asset sales in the Czech Republic can be attributed to Macquarie’s primary fund nearing the end of its investment horizon. “Last year, they also divested gas assets in Austria and Germany,” he informed HN. Dědeček anticipates that the selling price will be slightly below ten times the operating EBITDA, which stands above CZK 9 billion for GasNet.

The state will closely monitor the transaction’s outcome since the sale of strategic assets necessitates approval under the Foreign Investment Review Act, the newspaper emphasized.

GasNet’s net profit declined by 35 percent year-on-year to CZK 1.89 billion last year. Additionally, the company’s revenues decreased by seven percent year-on-year, amounting to CZK 14.4 billion. GasNet attributed this performance decline to the impact of the conflict in Ukraine and the resulting energy crisis.

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