KKR has plans to invest $750 million to Zenobē, a transport electrification and battery storage solutions firm, to accelerate the global decarbonization of diesel fleets and provide grid services that are critical for the decarbonization of the energy sector.
“This is a rare opportunity to support a clear leader in transport decarbonization and battery storage, two sectors which are critical in driving the transition to a net-zero world,” said Alberto Signori, partner in KKR’s European infrastructure team. “As a significant contributor to the decarbonization of our economies, Zenobē is an exemplary first investment in KKR’s global climate strategy which seeks to scale up businesses at the forefront of delivering real-world solutions to reduce carbon emissions.”
Infracapital, the infrastructure equity investment arm of M&G Plc and current majority shareholder, will invest further alongside KKR and the management team, with KKR and Infracapital becoming joint majority shareholders. The transaction is subject to customary closing conditions and regulatory approvals.
KKR’s investment in Zenobē is the first to be made through the firm’s global climate strategy, which is part of KKR’s $54 billion global infrastructure business and dedicated to investing in solutions at scale to support the transition to a low-carbon economy.
Zenobē’s EV fleet business provides end-to-end solutions to transition conventional internal combustion engine vehicles to electric, including financing of chassis, batteries on the vehicles, and charging infrastructure in depots, complemented with an integrated software solution. Through its network infrastructure business, Zenobē develops and builds large scale batteries that connect to transmission grids, providing essential grid services to complement the growth of intermittent low carbon energy generation and allowing economies to achieve their net zero ambitions, without compromising the grid stability.
Decarbonizing transportation, reducing pollution in big cities and towns and meeting national net-zero targets will require substantial investment and a rapid shift to electric vehicles. The transport sector is the largest source of carbon emissions globally, resulting in tightening regulations related to emissions by public transport.
KKR plans to work with Zenobē to meet the growing demand for EV adoption from bus operators and other commercial fleet businesses globally. KKR also expects to help Zenobē expand its grid-scale battery storage capacity through the construction and expansion of new and existing sites. The investment will help Zenobē to build on its leadership positions in the United Kingdom, Australia and New Zealand, while continuing to grow across continental Europe, and also expand into North America.