(Reuters) – The private equity firm Warburg Pincus has finalized an agreement to acquire Germany’s PSI Software for over 700 million euros ($811 million). Shareholder and client E.ON will continue as a strategic investor, the companies announced on Monday.
Last week, Reuters reported rumors of an imminent takeover of PSI, followed by Warburg Pincus’ bid for the developer of energy network software on Sunday.
After a nearly 11% surge on Friday following the news, PSI shares saw an additional increase of 35%, reaching 44.9 euros each—marking their highest point since January 2022.
This is close to Warburg Pincus’ proposed price of 45 euros per share, which represents a premium of about 50% compared to the company’s closing price on Thursday.
MAINTAINING MANAGEMENT STRUCTURE AND BERLIN HEADQUARTERS
PSI’s software facilitates the operation of power and gas transmission networks, essential to energy infrastructure, as well as factories. Reuters previously noted that it was exploring funding options for product upgrades.
Last year, the company faced significant disruptions due to a cyberattack that took down most of its IT systems, highlighting the risks tied to software supplies in vital infrastructure.
Consequently, PSI reported an annual loss before interest and taxes of 15.2 million euros ($17.6 million) in 2024.
PSI’s board has endorsed the buyer’s offer and plans to recommend it to shareholders. Following the completion of the deal, PSI intends to delist from the German stock exchange.
Furthermore, PSI noted that Warburg Pincus will preserve the existing management structure and maintain its headquarters in Berlin.
E.ON REMAINS A SIGNIFICANT SHAREHOLDER
“With our extensive experience in software and energy, along with a solid history of take-private transactions, we believe Warburg Pincus is the ideal partner to assist in the next stage of PSI’s development,” stated Warburg Pincus managing directors Max Fowinkel and Ryan Dalton.
According to PSI, Warburg Pincus has secured agreements for approximately 28.5% of the company’s equity from its primary shareholders. It was also noted that an anonymous major shareholder will reinvest part of their proceeds alongside Warburg Pincus into PSI’s holding framework.
Norman Rentrop, a German entrepreneur and newsletter publisher, holds the largest stake in PSI at 23%, while E.ON, Europe’s leading operator of energy networks, is the second-largest shareholder with around 18%.
For this transaction, E.ON will be considered as acting jointly with Warburg Pincus, the companies indicated.
Goldman Sachs is overseeing the sale process.
