London, UK: EQT is to acquire Constellation Cold Logistics – one of the largest cold storage providers in Europe – from Arcus Infrastructure Partners.
The EQT Infrastructure VI fund (EQT) says it will support Constellation as it looks to further strengthen its presence, carry out merger and acquisition (M&A) opportunities and deliver major expansion developments within Europe.
Constellation was established in 2020 by Arcus Infrastructure Partners, which brought together three businesses located in Belgium, Norway and the Netherlands. Just four years later, Constellation today owns and operates 26 large cold storage sites in seven countries in Western Europe and the Nordics. It employs 700 people and is expected to generate revenues of over €150m in the 2024 financial year.
Constellation provides temperature-controlled storage capacity and complementary services to a wide range of food producers, traders and retailers. Its sites are located either close to clients’ production and processing premises or near critical logistics routes to major cities, ports or food hubs. By offering warehousing and value-added services in these locations in an efficient, flexible and responsive manner, Constellation provides a critical service to its customers that ensures their supply and logistics chains remain smooth and safe.
The European cold storage market features strong underlying growth of around 7% per year, driven by multiple factors. For one, growing populations are leading to a greater demand for food. At the same time, the popularity of frozen and chilled foods is growing as the sector and customers recognize how these categories reduce food waste and improve quality. Producers are also increasingly adopting outsourcing, just-in-case supply chain strategies, and value-added services as the industry matures.
EQT has completed ten M&A deals in the past four years. With EQT, Constellation will be able to further expand within its existing catchment areas and enter new countries, both organically and through consolidation of the highly fragmented European market. Additional investment will be made into Constellation’s automation and digital capabilities to solidify a stronger foundation for growth.
Francesco Malvezzi, managing director within the EQT Value-Add Infrastructure Advisory Team, said: “Constellation is one of the leading cold storage providers in Europe with an excellent track record of growth, both organically and through M&A.
“It offers strong diversification across geographies, customers and end-markets and has impressive service offerings, customer focus and facilities. We’re excited to start working with Carlos (Constellation chief executive) and the team to help build an even stronger platform for continued growth. With EQT’s expertise in owning infrastructure companies that provide inherent essential services to society, we’ll be able to support Constellation as it works to deliver safe, quality food to people across Europe.”
Carlos Rodriguez, chief executive of Constellation, said: “In four short years, Constellation, with support from Arcus, has expanded into one of the largest cold storage players in Europe, enabling our clients to benefit from enhanced accessibility and efficiency in their supply chains.
“We will maintain an absolute focus on responsiveness and customer service together with our commitment to sustainability on our path to net-zero. We’re excited to continue implementing our 2030 strategic plan with the support of EQT, which brings strong infrastructure experience, global scale, and deep expertise in areas like sustainability and digitalization.”
The transaction is subject to customary conditions and approval. It is expected to close in October 2024.
