JSC Rietumu Banka has concluded a financing transaction, within which LTD Energy Investments, a special purpose company created by the management team of JSC Latvijas Gāze, acquired a 28.97% stake in Latvijas Gāze from the Luxembourg investment fund Marguerite Gas II.
To secure the financing from JSC Rietumu Banka, among other transaction conditions, the acquired shares of JSC Latvijas Gāze have been registered in the name of JSC Rietumu Banka as a bank investment. The transaction amount is confidential.
"The bank sees significant potential in management buyout transactions or so-called Management Buyouts (MBO). We were happy to finance this share acquisition, considering, in our opinion, a favorable valuation of the shares, the company's market position, and its free cash flow. We have also stipulated a series of significant conditions to secure the bank's financing, taking into account the size of the transaction and the volatility of commodities, including natural gas," says Jeļena Buraja, Chairman of the Board of JSC Rietumu Banka.
According to the transaction terms, Rietumu Banka will be represented in the Board of JSC Latvijas Gāze.
JSC Latvijas Gāze is one of the largest natural gas trading companies in the Baltic region, with a turnover of 702.6 million euros and a profit of 25.8 million euros in 2022. The company's equity at the end of last year was 312.1 million euros, and the cash balance at the end of the year was more than 41 million euros. Later in 2023, JSC Latvijas Gāze executed the sale of JSC Gaso, the gas infrastructure company it owned, further enhancing the company's liquidity and financial position.
