Infracapital, the infrastructure equity investment arm of M&G Plc, today announced it is investing a further c.£270m of equity to accelerate the growth of Zenobē’s fleet electrification and grid-scale battery storage business.
KKR, a leading global investment firm, will also invest c.£600m into Zenobe, forming a strategic partnership with Infracapital as joint majority shareholder in Zenobē. The transaction is subject to customary closing conditions and regulatory approvals.
These investments will play an important role in supporting Zenobē’s growth initiatives in the UK, North America, Europe, Australia and New Zealand, accelerating the decarbonisation of fleet transportation and maximising the uptake of renewables.
Since Infracapital’s initial investment in 2020, Zenobē has grown to establish itself as being at the forefront of two increasingly important industries. Zenobe currently supports more than 1,000 electric vehicles worldwide and has worked with operators to deploy vehicles in over 75 depots. By 2026, Zenobē aims to support 4,000 electric buses, trucks and commercial vehicles on the road. The company also has c.430MW of contracted grid-scale battery storage in the UK in operation or under construction, including its landmark 100MW battery storage asset at Capenhurst, Cheshire.
Zenobē, founded in 2017 by Nicholas Beatty, James Basden and Steven Meersman, was the third investment made by Infracapital Greenfield Partners II which followed Infracapital’s greenfield strategy to build, deliver and operate essential and sustainable greenfield infrastructure across Europe. It aims to meet the growing need for clean, new-build infrastructure to meet CO2 emission targets, whilst satisfying the changing needs of society and driving sustainable returns for investors.
Infracapital’s investment in Zenobe is a combination of direct equity investment and conversion of a convertible loan note that was put in place in January 2023 alongside other existing investors.
Andy Matthews, Head of Greenfield at Infracapital, said: "Since our initial investment in 2020, Infracapital has supported Zenobē’s significant innovation and expansion as it has gone from strength to strength in both the battery storage and transportation sectors. We are delighted to announce our further investment into the business, and to embark on this exciting journey alongside KKR as joint shareholders in Zenobē. This strategic partnership marks a significant milestone for the business and fulfils our confidence in its ability to continue to play a leading role in sustainable solutions. We look forward to continuing to contribute our expertise and resources to support Zenobē's further success on a global scale, whilst creating long-term value for our investors."
Nicholas Beatty, Co-founder and Director of Zenobē, said: “Batteries are the under-recognised crucial component of our future energy and transport systems, and they’re available now. We’re making huge strides in decarbonisation but it’s clear that too much renewable energy is being wasted and that transport decarbonisation must move faster. Batteries are critical to optimising the use of renewable electricity and making cheaper, greener and more secure power. As fleet operators transition to electric, batteries offer a proven and available technology which, combined with software and data optimisation, can optimise the operators’ fleet while achieving zero emission operations.
“Securing substantial further equity is a significant vote of confidence in our business, its achievements to date and future aims. KKR provides Zenobē with a leading international strategic partner to support our expansion plans into North America, Europe and Australasia and other markets, whilst Infracapital, who first invested in Zenobē in 2020 will continue to support the business.
“It is also an acknowledgement that boosting battery storage and clean transport is just common sense to help us reach net zero.”
Alberto Signori, Partner, European Infrastructure at KKR, said: “This is a rare opportunity to support a clear leader in transport decarbonisation and battery storage, two sectors which are critical in driving the transition to a net zero world. We believe Zenobē will continue to benefit from strong secular tail winds including stricter emission regulation in urban and regional areas, and the greater use of low carbon generation in the energy mix driving a need for grid balancing solutions. We see significant growth opportunities within Zenobē’s existing customer base, as well as huge potential in new markets globally. We are excited to bring our operational expertise within KKR’s global platform to actively support the company in continuing to further build a market leading and climate critical business.”
For further information, please contact:
Tom Murray / Colette Cahill
T: +44 7342 882 262
Infracapital invests in, builds and manages a diverse range of essential infrastructure to meet the changing needs of society and support long-term economic growth. We take an active role in all of our investments, whether nascent or large, to fulfil their potential and ensure they are adaptable and resilient. Our approach creates value for our investors, as we target investments with the scope for stable and sustainable growth. Our portfolio companies work closely with the communities where they are based, to the benefit of all stakeholders. Infracapital is well positioned to deliver the significant investment required to help build the future. The founder-led team of experienced specialists has worked with more than 60 companies around Europe and has raised and managed over €7.8 billion of client capital across six funds. Infracapital is part of M&G Plc, an international savings and investments business, managing money for around 5 million retail customers and more than 800 institutional clients in 28 markets. Total assets under management are £342 billion (as at 31 December 2022).
Zenobē is an EV fleet and grid-scale battery storage specialist, headquartered in the UK. The company began operations in 2017 with three founders and has over the past 6 years increased its staff to >230 FTEs with a wide range of leading skills including electrical engineering, software development, computer sciences and financing. It now operates in Europe and Australasia and is expanding into North America. Zenobē has 430MW of battery storage in operation or under construction with another 1.2GW of projects in advanced development in the UK which equates to circa 20% market share forecast by 2026. It has around 25% market share of the UK EV bus sector and c.1000 electric vehicles supported globally. The company is the largest owner and operator of EV buses in the UK, Australia and New Zealand.
Zenobe’s services are supported by market leading financing capability. This has included completing and drawing down against the Fleet private placement in February 2022 which raised over £240 million long term debt for the financing of Fleet customers, principally bus operators in the UK, over up to 16 years. This also included the financing of grid-scale batteries completed in February 2023 which raised £635m of debt including an accordion for the development of Zenobē’s grid-scale battery storage assets in Scotland.
KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com and on X (formerly Twitter) @KKR_Co.