German decision could smooth sale of metering firms

Published May 11th, 2017

The German Federal Cartel Office has stopped short of ordering a deeper investigation into water and electricity meter reading services, despite a highly concentrated market in which two companies hold a combined share of more than 50%.

Although the authorities noted “strong indications of the existence of an uncompetitive oligopoly”, its conclusions are widely seen as a trigger for the private equity owners of market leaders Techem and ista to move ahead with planned sales of the companies.

CVC Capital Partners, which owns ista alongside the Canada Pension Plan Investment Board and company management, announced last September that it was looking into strategic options for the future of the company, which generated EBITDA of €370 million on revenues of €850 million in 2016.

Techem posted revenues of €744.5 million in the year ended 31 March 2016, and is owned by Macquarie European Infrastructure Fund II, which recently exited Thames Water.