Arcus announces the sale of AEIF2’s interest in Constellation Cold Logistics 

Arcus Infrastructure Partners (“Arcus”) is pleased to announce that on 22 June 2024, Arcus European Infrastructure Fund 2 SCSp (“AEIF2” or the “Fund”) entered into definitive documentation for the sale of 100% of Constellation Cold Logistics (“Constellation” or the “Company”) to the EQT Infrastructure VI fund (“EQT”).

Cold Chain Federation member Constellation is the leading independent cold storage logistics business in Europe, with 26 large cold storage facilities across seven countries in Western Europe and the Nordics. The London-headquartered business employs over 700 people and is expected to generate revenues of over €150 million in FY24.

Constellation provides temperature-controlled storage capacity and value-added services to a wide range of food producers, traders and retailers. Its sites are located either close to client production and processing hubs, near critical logistics routes, including several seaports, or in close proximity to major European consumption centres. Constellation provides cold storage capacity for a wide range of food product categories, from processed potato products to meat, fish and seafood, and serves a highly diversified and blue-chip customer base with deep, longstanding customer relationships.

Arcus first invested in Constellation in 2019, establishing the platform formally in early 2020, and since that time has supported Constellation through an active period of growth, including the build-out of an industry-leading management team, multiple strategic bolt-on acquisitions, customer-led expansions across four countries, many operational optimisation initiatives and broader institutionalisation of the group. This has been done with a focus on sustainability and in partnership with several original founders of businesses acquired by Constellation, who have been instrumental in ensuring that their strong legacy is embedded in the business for its continued long-term success.

Under Arcus ownership, Constellation has become a sector ESG champion, leading the decarbonisation of the cold storage supply chain in Europe. Constellation has invested significantly in energy efficiency and on-site renewable power generation in recent years, with c. 12% of its electricity consumption being provided by its rooftop solar plant. The Company also has an impressive ESG track record, having attained 93 points out of a possible 100 in the recent GRESB 2023 assessment.

Jordan Cott, Partner and Head of Logistics & Industrials at Arcus, commented: “We identified a highly attractive opportunity in 2019 to create a leading cold chain infrastructure business in this fragmented and growing market, and are incredibly pleased with what we have been able to achieve with Carlos and the team over the past five years. We are grateful to the founders of the original businesses that now form key pillars of Constellation today for their trust and partnership as we delivered on our strategic plan. From a two-site, single-country operation in 2019, Constellation has become a true European champion in the cold storage space, maintaining its deeply entrepreneurial and customer-centric culture while unlocking the benefits of an institutionalised, highly scalable corporate platform. It is a perfect example of execution in line with the Arcus investment strategy, focusing on identifying, building, professionalising and optimising mid-market European infrastructure businesses through the dedicated and continuous application of the Arcus value creation toolkit. We are confident that Constellation will continue on its exceptional growth trajectory through the next chapter of its evolution.”

Carlos Rodriguez, CEO of Constellation, said: “I joined Constellation because I shared Arcus’ vision of Constellation becoming the leading independent cold storage business in Europe. Important to this, I truly believe that while Constellation has grown so significantly over the past five years and we have institutionalised many of our levers for success, we have also managed to maintain a strong focus on our customers, organisational culture and local market knowledge. Arcus has been the ideal partner for this journey, providing its infrastructure expertise, insight and capital to scale and professionalise the business, while balancing that with our shared focus on core values and an entrepreneurial culture. I want to thank Jordan and the whole Arcus team for their commitment to our vision, and their support across so many value creation initiatives over the years. We have laid the foundations providing Constellation with a unique market position and opportunity and, in partnership with EQT, I have high conviction on our ability to capture continued outsized growth over the coming years.” 

The transaction is subject to regulatory approvals and is expected to close in October 2024.

Arcus was advised by Macquarie Capital (M&A), Seven Lakes Partners (M&A), Kirkland & Ellis (Legal), DLA Piper (Legal), OC&C (Commercial), EY (Financial and Tax), CBRE (Technical), ERM (ESG) and AON (Insurance).

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