TPG Rise Climate acquires majority stake in A-Gas but KKR remains involved

Major shareholders of global refrigerant specialist A-Gas have reached an agreement to sell a majority stake in the company to TPG Rise Climate, the climate investing platform of TPG Rise.

The transaction is expected to be completed by the end of 2023, subject to customary closing conditions and regulatory approvals. Current major shareholder KKR will retain a significant minority stake and continue collaborating with TPG Rise Climate and the A-Gas leadership team.

A-Gas has been a pioneer in refrigerant recovery and reclamation for over 30 years. Its closed-loop system prevents the release of harmful gases into the atmosphere. The company says that in 2022 alone, it effectively abated approximately eight million metric tonnes of CO2e, equivalent to removing more than 1.6m cars from the roads for a year.

“We are thrilled to be taking the next step of our sustainability journey, and to be further scaling our Lifecycle Refrigerant Management operations, with the backing of TPG Rise Climate,” said A-Gas Group CEO Jack Govers.

Under KKR, A-Gas achieved remarkable financial growth, with an average annual increase of 14 per cent in revenue and 18 per cent in net income, accomplished by expanding its market presence across Europe, including Germany, the Netherlands, and Italy.

It also scaled up operations in the United States and entered the Canadian market with a new refrigerant recovery and reclamation facility. Additionally, A-Gas expanded in Asia through the acquisition of a Japanese refrigerant reclamation and destruction company, enabling the company to enter new growth areas and offer services such as on-site rapid recovery of refrigerant gas, safe destruction of legacy gases, and facilitating the generation of carbon credits.

An end-of-life refrigerant destruction facility serving the Australasian market is being established independently of refrigerant stewardship scheme operator Refrigerant Reclaim Australia currently, which currently contracts two sites nationally for the safe destruction of refrigerant.

TPG Rise Climate’s investment in A-Gas aligns with its focus on establishing circular economies and addressing climate change. Patented ‘PyroPlas’ refrigerant recovery and reclamation technology operated by A-Gas plays a crucial role in closing the loop on refrigerant gas lifecycles and preventing harmful emissions in several global markets.

“Demand for refrigerants continues to grow, and regulatory scrutiny and enforcement increase. We believe A-Gas is well-positioned to meet these challenges,” said TPG Rise Climate business unit partner Joerg Metzner. 

The completion of this transaction will signify the departure of minority investor LDC after 12 years, and while financial details of the transaction have not been disclosed, the acquisition by TPG Rise Climate and continued collaboration with KKR are significant for A-Gas. It positions the company to further advance its global expansion and meet the increasing demand for refrigerant use.

KKR co-head of European private equity Mattia Caprioli commented: “We believe the addition of TPG Rise Climate’s market expertise, particularly in the US carbon credit market, is a great fit for the future, and we look forward to working alongside Joerg, Jack and their respective teams to continue to build on A-Gas’s unique proposition globally.”