Co-investment for leading dry bulk carrier in Baltic region

(Posted on 11/02/24)

Varma Mutual Pension Insurance Company has agreed to co-invest EUR 15 million alongside OP Finland Infrastructure LP in ESL Shipping, a subsidiary of Aspo Plc. As a result, the combined investment into ESL Shipping managed by OP Finland Infrastructure LP rises to a total of EUR 45 million at the closing of the transaction.

ESL Shipping is the leading carrier of dry bulk cargoes in the Baltic region. The combined fleet of ESL Shipping and AtoB@C Shipping consists of over 40 vessels with cargo capacity ranging from 4,000 to 56,000 dwt.

The co-investment by Varma is made with the same valuation and terms as agreed between Aspo and OP Finland Infrastructure in their 8 November 2023 announced EUR 30 million investment in ESL Shipping. Competition authority approvals and change of control approvals from financial institutions have been received and the closing of OP Finland Infrastructure LP’s investment together with Varma’s co-investment is estimated to take place on February 29, 2024.

The combined EUR 45 million investment managed by OP Finland Infrastructure LP will be made against the issuance of new shares in ESL Shipping with an agreed pre-money equity valuation of EUR 165 million, corresponding to a 21.43% ownership stake in ESL Shipping. This implies an enterprise value of approx. EUR 300 million for ESL Shipping.

“We are delighted that Varma alongside OP Finland Infrastructure has decided to invest in the ongoing green transformation of ESL Shipping. This additional equity further accelerates the implementation of ESL Shipping’s low-carbon growth strategy to provide fossil-free sea transportation in the future”, says Rolf Jansson, CEO of Aspo Group.

“ESL Shipping plays a pivotal role in Finnish maritime transportation and our investment with OP Finland Infrastructure supports the growth and de-carbonization of ESL’s fleet going forwards. Investments in accelerating green transition are in the core for us”, says Johanna Haikala, Investment Manager of Varma Mutual Pension Insurance Company.

The program to accelerate ESL Shipping’s green transformation will continue through further investments in fleet and technologies enabling fossil-free shipments for the company’s customer base. The already ongoing investment in twelve green coasters is progressing as planned. A total of seven vessels are already under construction and the first vessel in the series, Electramar, was successfully delivered in December. The second vessel, Stellamar, was launched in October.