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Eqva ASA and Kvinnherad Elektro AS, a full-service power and automation company, have signed a letter of intent for a business combination agreement. The agreement includes Kvinnherad Elektro’s 51 percent ownership in Vassnes Solutions AS, a group of leading engineering, welding, power and automation services companies.
This move, which both companies consider to be of high strategic value, will result in the establishment of a prominent and fully integrated system supplier within the piping, power and automation disciplines. The agreement strengthens Eqva’s position as a leading supplier for the upcoming significant upgrade and restructuring of Norwegian industry. After consolidation, Eqva will consist of more than 600 highly qualified employees.
As of Q1-2023, Eqva reported an expected turnover for 2023 of between NOK 650-750 million and an order book of NOK 461 million. The merger will result in an increased turnover for Eqva of between NOK 125-175 million on an annual basis and an increased order book of NOK 120-140 million. The company will provide updated forecasts in relation to the 2nd quarter presentation in August.
Under the current plan, Eqva will acquire all shares of Kvinnherad Elektro AS in exchange for shares in Eqva’s wholly owned subsidiary, BKS Holding AS, along with a cash component. Further details regarding the settlement will be disclosed upon finalization of the business combination agreement. The subsidiary of EQVA will be listed on the Oslo stock exchange in the next 12-24 months.
The planned business combination will significantly increase Eqva’s capabilities and expertise in attractive power and automation markets. It will also increase the company’s flexibility to undertake major contracts in engineering, green transition and electrical services.
“With this move, Eqva continues to deliver on its strategy for growth and broadening of its service offering. This combination enhances Eqva’s access to attractive markets in Western Norway such as the smelting industry, maritime industry, and power and automation industry. We look forward to working with our new colleagues in both Ølen and Rosendal and will strive to further enhance our service offering for our valued customers,” said Erik Høyvik, CEO of Eqva.
The anticipated completion of the business combination agreement is set for Q3 2023, with the transaction becoming effective from Q4 2023.
“In addition to opening new market segments for Eqva, we will be able to leverage synergies between the companies involved. Kvinnherad Elektro and Vassnes Solutions have approximately 155 skilled professionals in total. In our subsidiary BKS we have 80 employees working in the power and automation segment. Together we will have a pool of approximately 240 skilled and experienced employees,” Mr. Høyvik added.
Following the transaction, both Kvinnherad Elektro and Vassnes Solutions will continue to operate under their current brand and management, ensuring a seamless continuation of their operations.
«We are excited to become part of Eqva. We have a history of close collaboration with Eqva’s subsidiary, BKS, and we operate in the same region and markets. This merger gives us an opportunity to increase our market share and strengthen the competence and quality of our services to both existing and new customers. We also see potential to undertake larger multidisciplinary projects in the future," said Kjetil Helvik, general manager of Kvinnherad Elektro.
A presentation which describes the planned transaction, the strategic rationale, and the combined business post-transaction is enclosed and available on www.eqva.no.
In photo from left: Knut Johannes Helvik, Chairman of the board in Kvinnherad Elektro AS, Kjetil Helvik, CEO in Kvinnherad Elektro AS, Trygve Kjerpeseth, CEO in BKS Holding AS and Tore Thorkildsen, Sales Manager in BKS Holding AS. Photo: David Sande
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