Speaker 1: With laurents segal and from London and Gerard Reed from Berlin.
Speaker 1: This is Redefining Energy today. On redefining energy or actually
Speaker 1: going to talk about a company or an institution, KKR,
Speaker 1: which is one of the biggest private equity businesses in
Speaker 1: the world and they're heavily involved in the energy infrastructure sector.
Speaker 2: Yeah, because on this podcast we talk a lot about
Speaker 2: those big private investors, but at some point it is
Speaker 2: great to really understand how they function, how they think,
Speaker 2: what is their strategy, how it's evolving. So if we
Speaker 2: look at KKR, they've invested dozens of billions in the
Speaker 2: acquisition of assets in our sector. And I'm just going
Speaker 2: to name a few because you're going to hear about
Speaker 2: them during the conversation. Zeno b Adventus, albionma Conto, Global
Speaker 2: actis Igny, sms at Shiona and Kavis ecg Any Bayou
Speaker 2: fuels crazy. The level of their activity.
Speaker 1: For me, it's really interesting on as their strategies because
Speaker 1: what they're really doing is they want to create platforms
Speaker 1: and they want to create next generation energy services businesses.
Speaker 1: And you know, it's energy service and a victag. So
Speaker 1: you've got a business that's looking at mobility. You've got
Speaker 1: a business is looking at in turn industrial and commercial.
Speaker 1: They're in different regions, and and and and they all
Speaker 1: have some form of competitive advantage. And basically what KKR
Speaker 1: doesn't help these businesses scale.
Speaker 2: We have the pleasure and the privilege of inviting Emmanuel
Speaker 2: la Gaigue, who is a partner at kirk and co
Speaker 2: head of the Global Climate Group.
Speaker 1: Yeah, and guide Lauren. I've known for a long, long while.
Speaker 1: He's been in this whole energy space the whole of
Speaker 1: his career. You know, he was formerly had a strategy
Speaker 1: at Schneider. Yeah. Great guy to have on board to
Speaker 1: talk about not just KKR, but also just how he
Speaker 1: sees the future and how he's trying to create it
Speaker 1: with the businesses that is investing in scaling.
Speaker 2: And of course we're asking about the topics right now
Speaker 2: that isn't a Hi what he thinks about hydrogen green premium.
Speaker 2: I mean really really a treat for us and I
Speaker 2: guess for our listeners.
Speaker 1: Agree, totally listen. Why don't we bring him on the show.
Speaker 2: Emanuel, Welcome to the show.
Speaker 3: Thank you, Lauren, Thank you. Jerrar gread to be here.
Speaker 2: Ko manages seven hundred billion which is enormous people don't realize,
Speaker 2: out of which probably ten percent are dedicated to energy
Speaker 2: Infatulu Emanuel, first, can you give us a big picture
Speaker 2: of how all this fits into KKO strategy.
Speaker 4: Yeah, So, as you said, the infrastrator franchise within KKI
Speaker 4: is roughly seventy to eighty billion of asset under management.
Speaker 4: That's a platform that started actually right after the global
Speaker 4: financial crisis in two thousand and nine and has been
Speaker 4: growing extremely fast in them used to take KEK is
Speaker 4: the second larger infrastruture investor on the planet, the largest
Speaker 4: in Asia Pacific, and so we are very proud of
Speaker 4: it and how our things are being developing and out
Speaker 4: of this, if we look at energy assets and assets
Speaker 4: linked to the energy transition, almost a third of those
Speaker 4: investments have been in and around energy. The important point
Speaker 4: here is that sometimes when people think about infrastructure, the
Speaker 4: thing that come to mind is tow roads and ports
Speaker 4: and airports. This is not what we do. It's a
Speaker 4: very different type of assets.
Speaker 3: Today. Most of the.
Speaker 4: Activity across the platform is in data centers and how
Speaker 4: you bower the data centers and our AI is changing
Speaker 4: the paradigm with what we're doing with my cohead and
Speaker 4: partner Charlie around climate under decombonization of a number of
Speaker 4: supply chains. We're talking about private assets and not so
Speaker 4: much what was to twenty five years ago infrastructure.
Speaker 3: I think that's one of the ingredients of.
Speaker 4: The success of the car infrastructure platform. So it's like,
Speaker 4: how do you build businesses which are buying large private
Speaker 4: infrastructure businesses with no sensitivity to GDP or very low
Speaker 4: sensitivity or exposure to GDP, predictability of cash flows, downside
Speaker 4: protections and all the things that in the volatile environment
Speaker 4: are becoming a really interesting place to go for.
Speaker 1: And Mana, let me just jump in there maybe just
Speaker 1: before we talk about your strategy and the types of
Speaker 1: companies you invest in, could you talk about how you
Speaker 1: look at risk and reward. Do you have a sort
Speaker 1: of one view of it or do you have different
Speaker 1: funds that look at different types of risk rewards? Just
Speaker 1: maybe talk a little bit about that.
Speaker 4: Yeah, we have different strategies. Just take one sector, renewables.
Speaker 4: If you're investing in operating assets of wind and solar,
Speaker 4: where you have long term PPAs everything is built so
Speaker 4: it's very predictable, it's a lower risk glor return strategy,
Speaker 4: so that would go into our core strategy. If you
Speaker 4: invest in a brown to green conversion, you take generating
Speaker 4: assets on agreed, then you're converting them away from fossil
Speaker 4: fuels and into renewables and biomass, where there's a bit
Speaker 4: more work, there's a bit more of a personal leverage,
Speaker 4: but it's still relatively predictable and stable asset. So you
Speaker 4: would put this in it's a higher risk and higher return.
Speaker 4: That's more of a corplus type of strategy. And then
Speaker 4: when you look at an asset like Adventus here in
Speaker 4: the US, where we basically sell high tech solar and
Speaker 4: battery projects in the places of the US where it's
Speaker 4: highly needed, very high in the interconnection queue, so there's
Speaker 4: much more development work there. So that goes into the
Speaker 4: Climate Fund, which is more about developing the next generation
Speaker 4: of the carbonization asset. So we have to be very
Speaker 4: disciplined on how we treat everything and which asset will
Speaker 4: go in which box. The beauty of having several strategies
Speaker 4: and several ways to treat that risk return is that
Speaker 4: we can cover the entire span of what's happening, for instance,
Speaker 4: in renewables and I could take the example of AI
Speaker 4: in at a center all the places where we can
Speaker 4: be very clear with our investors, right, so they know
Speaker 4: exactly which strategy is going to invest in, which type
Speaker 4: risk return asset.
Speaker 2: Emanuel, when I read the presentation of all various activities,
Speaker 2: you were on a geographical split forty America, forty Europe
Speaker 2: twenty Asia. If I'm not mistaken, have you been able
Speaker 2: to follow or you have like even flows or how
Speaker 2: do you cope with the geographical diversification small.
Speaker 4: Less how things are unfolding? Where we have that split
Speaker 4: is mostly for the climate strategies. But we say to
Speaker 4: decombanization strategy together with the positive returns, right, so it's
Speaker 4: returns first because we don't think there should be a
Speaker 4: trade off between the cambonization and return. So it has
Speaker 4: to create a return and also decoveranize the same time
Speaker 4: with But we say so if we do the is
Speaker 4: that's going to be mostly in no easid countries. Therefore
Speaker 4: split between North America, Europe and Asia Developed Asia. I
Speaker 4: should say this is roughly what's happening. We have started
Speaker 4: a little bit more tilty towards Europe for different reasons.
Speaker 4: It was easier for us to do the first deals
Speaker 4: there the market where also valuations and volatility were lower.
Speaker 3: But roughly what we were predicting is happening.
Speaker 1: Maneuel. Can I pick you up on that point about
Speaker 1: your focus on Europe and also what you said about valuations,
Speaker 1: because what I think very interesting about what you've done
Speaker 1: is you've actually taken quite a few public companies privates.
Speaker 1: And I sort of scratched my head and just say,
Speaker 1: if that's the case, then you know basically something wrong
Speaker 1: with our public markets in Europe.
Speaker 4: I don't think it's exclusive to Europe, and we see
Speaker 4: that everywhere public markets have become volatile and with a
Speaker 4: very low tolerance to risk or change. This is why
Speaker 4: you see all the biggest set managers, and we're not
Speaker 4: the only ones. When we look at Larry Fink's and
Speaker 4: your letter. It's all about democratizing the access to infrastructure investment.
Speaker 4: So the paradox of this is that private investment, and
Speaker 4: especially in infrastructures, is becoming more stable, more predictable, especially
Speaker 4: if you want to transform things, and we've seen that
Speaker 4: around the energy and the energy transition. Five years ago,
Speaker 4: six years ago, you would see CEOs of public companies
Speaker 4: going to their board and their shoulders with very bold
Speaker 4: transition strategies. Hey, we're going to invest two three billion
Speaker 4: into this, into that transition, and we'll create a new
Speaker 4: green growth engine to our portfolio. That has not happened
Speaker 4: because this is not what public markets are made for.
Speaker 4: Of course, the attractiveness of public markets, it's like it's
Speaker 4: the lowest tier of cost of capital. You have very
Speaker 4: cheap capital, but in exchange you need to give predictability.
Speaker 3: Very simple equity story.
Speaker 4: So today many of those companies who were promoting this
Speaker 4: type of strategy five six years ago, our companies we
Speaker 4: are talking to because private capital and private infrastructure is
Speaker 4: probably the place where this should happen. Yes, it's a
Speaker 4: high cost of capital that there's a guarantee of delivering.
Speaker 4: So for many of those companies, the conversations we are
Speaker 4: having are, but let's create that green growth asset that
Speaker 4: you were planning to do, but it's going to be
Speaker 4: off balance sheet of pnls, so that you don't have
Speaker 4: to consume capital from your shoulders and from your balance sheet.
Speaker 4: You don't also to force your shoulders in subscribing to
Speaker 4: a strategy. They may not like we build that asset.
Speaker 4: We give you the optionality once the asset is at
Speaker 4: scale and you can tell an equity story that your
Speaker 4: shoulders are ready to hear, but then you can take
Speaker 4: it back or not. If that never happens, well we'll
Speaker 4: go figure out what we do with this asset. So
Speaker 4: we see that changing because private markets are usually better
Speaker 4: equipped for anything that that is a transformation like this.
Speaker 2: And case in point two months ago there was this
Speaker 2: listed fun on that risk called Harmony and they've been
Speaker 2: taken private with an eighty eight percent premium on their
Speaker 2: stockitching variation. So it was very clear that the stocking
Speaker 2: change was not finding the value. So we really understand
Speaker 2: that and more. They speaking if we look just the
Speaker 2: last five years and you are a long term investor,
Speaker 2: but then you take COVID, the hydrogen bubble, Russia, Ukraine,
Speaker 2: now we have the treasuy wars and volativity absolutely crazy.
Speaker 2: So how do you survive all this?
Speaker 4: This is part of life, So see why you have
Speaker 4: to take a long term view, none jerk reaction, Understand
Speaker 4: where this is going, try to calibrate and measure those risks.
Speaker 4: We are spending a lot of time talking to governments,
Speaker 4: not because we want to extract subsidies or preferences or influences.
Speaker 4: We just want to understand where they are going. Because today,
Speaker 4: even in the West, policies and regulation around energy become
Speaker 4: somehow volatile, and when there's an election, you can have
Speaker 4: a change of direction. That's fair, that's how it works.
Speaker 4: So we just take this into account and we try
Speaker 4: to make the most of it. And if you think
Speaker 4: about it, and that's what our founders Henry Cravis Central
Speaker 4: Roberts always reminders when like guys at KKR, we invested
Speaker 4: in periods of time where inflation was double digit in
Speaker 4: the US and KR was successful. So that world is
Speaker 4: going to change around you and influence what you can
Speaker 4: influence and for the rest trust to apprehend those risks
Speaker 4: and understand them the best you can. And of course
Speaker 4: that long term is a bit, especially when you invest
Speaker 4: in energy and the cambonization, you have to take a
Speaker 4: long term. This is a multidicated story. Let's not try
Speaker 4: to think this is the next LM or SaaS do
Speaker 4: things take time. We're talking about the infrastructure. We're talking
Speaker 4: about very large investments about changing the energy mix of
Speaker 4: countries or companies. So that's going to be long can.
Speaker 1: Maybe we talked a little bit about your investment strategy,
Speaker 1: because from outside, what I look at is that it
Speaker 1: seems that you're investing in what I call platform businesses,
Speaker 1: in other words, businesses that you can really scale by
Speaker 1: bringing them into their countries, bringing them into the markets,
Speaker 1: or whatever it is. Is that a fair synopsis of
Speaker 1: what you're doing.
Speaker 4: Yeah, especially when the climate strategy, there is this notion
Speaker 4: of platform. So if you take the example of the
Speaker 4: NOB it's a high development, high growth platform where we
Speaker 4: electrify mass transit systems. We help bus operators in the
Speaker 4: UK and Europe, in Australia transition their diesel fleets to electric.
Speaker 3: This is new.
Speaker 4: You have to take into account or you're going to
Speaker 4: charge those buses, or you remove the frictions, or you
Speaker 4: create a return out of the favorable total cost of
Speaker 4: ownership that an electric fleet is bringing you over the
Speaker 4: diesel fleet, and so on and so forth. What we've
Speaker 4: done in Spain withness Power to X it's a platform
Speaker 4: to decarbonize the supply of electrons and molecules and steam
Speaker 4: to heavy industry. What we are doing now in Germany
Speaker 4: around the electrification of heat for industrial and buildings and
Speaker 4: multifamily residential buildings. We are building a platform with a
Speaker 4: roll up of several companies and contracted transitions from gas
Speaker 4: to heat pumps of heating systems and heat as a service.
Speaker 4: It's a very small platform today, but as we grow,
Speaker 4: it should be big, unstable, and therefore it's very likely
Speaker 4: that the next owner of that platform will be a
Speaker 4: corplus and infrastratural fund. So the big names you find
Speaker 4: infrastructure and again probably not a care because we don't
Speaker 4: play that game, but all the other big names in infrastructure,
Speaker 4: we probably have appetite for this. So we're really trying
Speaker 4: to build the platforms, especially when there's a story of
Speaker 4: direct or indirect electrification, because electrification simply brings with an
Speaker 4: efficiency in the system, and if you're able to transform
Speaker 4: that efficiency into a returning they've created something that is
Speaker 4: economically viable without subsidies, without premium to be so for
Speaker 4: and things like this.
Speaker 2: When I look at your portfolio and again you know
Speaker 2: it one hundred times better than us, you see some
Speaker 2: companies who do the same things or sometimes in different geography.
Speaker 2: So can you coordinate? Okay, let's say seller Panels, you
Speaker 2: made a call with all your companies. Look, guys, these
Speaker 2: guys has the best seller panel supply chain, or this
Speaker 2: guide managed to get the best deal for winterbine, or look,
Speaker 2: this is the best trading system that we figure out,
Speaker 2: So why don't everybody use it? I mean, is there
Speaker 2: a way to spread the best practices.
Speaker 4: Yeah, we have a whole team internally called caps Tone.
Speaker 4: That team is doing exactly that. They help the companies,
Speaker 4: especially when we're talking about young platforms. They help professionalized
Speaker 4: processes find the best resources when it comes to procure
Speaker 4: sol panels, batteries or the things using the breadth of
Speaker 4: the KKR platform, not just the different platform, the seven
Speaker 4: undred billion AUM and a two hundred and fifty plus
Speaker 4: portfolio companies of KKR and the fifty years of having
Speaker 4: done this. So we have a whole internal team that
Speaker 4: just optimizes. So helps the companies optimizing their economics, which
Speaker 4: of course at the end makes them stronger. Professionalizing processes,
Speaker 4: optimizing procurement, creating synergies when there are some always being
Speaker 4: very careful. So synergies are good between companies to an extent, right,
Speaker 4: so that you don't want them to become a distraction
Speaker 4: or if they are coming from several strategies or things.
Speaker 4: You don't want to have a distraction between even between
Speaker 4: teams within KKR. But that's the only limit. Otherwise we
Speaker 4: try to do this a lot.
Speaker 2: It's been twenty minutes and there's a world who have
Speaker 2: not pronounced it's Ai Ai Ai Ai. So what's in
Speaker 2: it about Ai? Because I read the recent IA report
Speaker 2: and everybody's going gangbusters and we need I don't know
Speaker 2: how much more power. What's KIKR take on AI? And
Speaker 2: of course we are interested by the energy and girl.
Speaker 4: Yeah, so if we start from the real estate angle
Speaker 4: of this KKR, we are own five that isn't the
Speaker 4: platforms across the world. So we have that constant communication
Speaker 4: with all the hyperscaloes, basically the seven large talking about
Speaker 4: the West here when not really engage in China on this,
Speaker 4: but in the West, we have that constant dialogue with
Speaker 4: the seven companies, seven large companies in that race because
Speaker 4: of course we build infrastructure that a center infrastructure for
Speaker 4: them for their cloud infrastructure.
Speaker 3: But also for their infrastructure, and of course.
Speaker 4: More and more over the last couple of years, it's like, oh,
Speaker 4: can I have the data center infrastructure together with the power.
Speaker 4: Can you do also something with the power big that
Speaker 4: the thing is going to become very powerented see very quickly.
Speaker 4: So that does take us into a journey or for
Speaker 4: the first question is that, okay, is it going to
Speaker 4: be different this time, because if you remember twelve years
Speaker 4: ago when all the cloud infrastructures was built, everybody was
Speaker 4: also scrambling for power while the it is going to
Speaker 4: become very energy intensive and so on and so forth.
Speaker 4: But at the end they were involved productivities that were
Speaker 4: brought in the system efficiency and other productivity on how
Speaker 4: the computer was organized for these good big cloud providers
Speaker 4: and at the end the energyman was flat. So there's
Speaker 4: a bit of that thinking like let's be mindful of
Speaker 4: what could happen. There will be other productivity moments. We
Speaker 4: saw DEEPSEK a few months ago. That's a productivity moment, right,
Speaker 4: Something that's through software is more efficient at developing llms.
Speaker 4: I'm sure that the big suppliers of chips will come
Speaker 4: with more efficient solutions and videos. Chips are becoming more
Speaker 4: energy efficient over and over. When it comes to energy,
Speaker 4: everybody starts thinking generation, we need more generation faster. While
Speaker 4: there's a lot of slack in the grid. The distribution
Speaker 4: grid in the US and in Europe is overbuilt. Especially
Speaker 4: in the US it's overbuilt. There is something like thirty
Speaker 4: percent of the interconnections are and use eighty percent.
Speaker 3: Of the times.
Speaker 4: So just discovering that slack which doesn't need any CAPEX
Speaker 4: anything is you just have to organize properly the demand
Speaker 4: respond and all this without adding more generation. This is
Speaker 4: why there everybody is going a bit fast into oh
Speaker 4: we need two times more three times more energy.
Speaker 3: Well maybe not, we need more energy this time.
Speaker 4: It's unlikely to see a repeat of the cloud story
Speaker 4: where the end the energy deman was flat. We will
Speaker 4: probably need more energy, but not as much as what
Speaker 4: some people would tend to say. Now to do that,
Speaker 4: centers are going to require energy in very high density.
Speaker 4: This is why people start talking about nuclear because of
Speaker 4: course there's so much you can do with women, solar
Speaker 4: and gas when gas is going to be constrained because
Speaker 4: you basically have five gas stourbine manufacturers and the backloger
Speaker 4: and five six years today. So if you want to
Speaker 4: build a new gas fire power plant, even say I'm
Speaker 4: going to run my at center i knew data center
Speaker 4: on gas, Yeah, you can start it in.
Speaker 3: Six years from now.
Speaker 4: So today, both in Europe and in the US, if
Speaker 4: you want to have power fast, you go for solar,
Speaker 4: and we see that we are selling a lot of
Speaker 4: solar projects to hyperscalers and people who are building AIDATA centers.
Speaker 4: Or you grab existing capacity.
Speaker 3: Of gas and thermal plant.
Speaker 4: That was the purpose of our partnership with the cl
Speaker 4: and eventually you will have more gas and eventually we
Speaker 4: see cs probably because those hyperscaler especially the big ones,
Speaker 4: they still worry about that cabin for print to some extent.
Speaker 4: And eventually it will get nuclear. Now which flavor of nuclear?
Speaker 4: Will it be the nuclear we have known forever Allah,
Speaker 4: Hinkley Point or Vogel. Will it be restarting the nuclear
Speaker 4: reactors like what Constellation and Microsoft start trying to do
Speaker 4: with one of the reactors at three Mile Island. Will
Speaker 4: it be a SMRs, which are very very promising on
Speaker 4: paper but haven't really been tried outside of Russia and
Speaker 4: China and the economics will see but on paper it's
Speaker 4: just perfect, but I'm tried. Or will it be fusion?
Speaker 4: Even so, all this sounds a bit far away. So
Speaker 4: one is known, but very expensive. The second one and
Speaker 4: the other three have never been tried, right, so restarting
Speaker 4: a reactor, SMRs or fusion seducing on paper, but we'll
Speaker 4: see it anyway.
Speaker 3: None of those is going to be available.
Speaker 4: For reaching cod before at least twenty thirty twenty thirty
Speaker 4: five if we lucky, So we see all these, there
Speaker 4: will be more energy demand, but not that much, not
Speaker 4: two times three times two. There's a lot of shortcuts,
Speaker 4: the slack on the grid, solar and batteries, existing formal capacities.
Speaker 4: That's going to be where things are going to go
Speaker 4: into the short term and eventually in a few years
Speaker 4: from now we talk about more gas and probably nuclear
Speaker 4: or the sources, but we'll see where it goes.
Speaker 1: Avanue I just maybe as we wrap up here, I
Speaker 1: look at it and say, we're living to the era
Speaker 1: of volatility. But of course volatility passes, then what happens.
Speaker 1: How do you see it? How do you see the future?
Speaker 4: Basically, Yeah, there are a lot of ext factors for volatility,
Speaker 4: and also within the energy world there's been a bit
Speaker 4: of self inflicted ones. So just look at all the
Speaker 4: buzz around hydrogen two years ago with a lot of
Speaker 4: people who didn't really care about the reality of what
Speaker 4: a hydrogen molecule is, if you can transport it or not,
Speaker 4: if it was really making sense from an industrial standpoint
Speaker 4: for a number of applications, and that has led the
Speaker 4: number of countries to build hydrogen policies which were built
Speaker 4: on shaky grounds. And now you have a lot of people,
Speaker 4: but hydrogen is not happen. Investors are not putting money
Speaker 4: in hydrogen, and no, we're not going to put money
Speaker 4: in things that don't have an economic viability over time,
Speaker 4: where there's no industrial logic where I'm sorry, but physics
Speaker 4: and supply chains are basic that you have to understand
Speaker 4: and take.
Speaker 3: So what I.
Speaker 4: Mean with this, Yes, there is volatility. We can always
Speaker 4: complain about all the phenomenons that Lauren was mentioning at
Speaker 4: the beginning, but sometimes also within the world of energy
Speaker 4: has been a bit of happy ideas and find people
Speaker 4: trying to apply the recipe of other industries to especially
Speaker 4: to the combonization, and that has created volatility, backlash and everything.
Speaker 4: So relatidity is part of the game. But if we
Speaker 4: stay grounded, if we understand the physics, if we understand
Speaker 4: the supply change, how you get the economic viability how
Speaker 4: you apprehend green premiums, where you have green premiums, and
Speaker 4: being realistic about how you're going to eliminate them, and
Speaker 4: not to wait for the next government to subsidize you
Speaker 4: for the next twenty five years. So if you take
Speaker 4: the first principal approach to number of things, I'm very
Speaker 4: optimistic looking at the long term, looking at how we
Speaker 4: are going to get enough energy for AI and electrification
Speaker 4: and other priorities. Make sure that energy is affordable, make
Speaker 4: sure that energy which is now definitely at the core
Speaker 4: of the national security of basically every region in the world.
Speaker 4: And if on top of this it's the cabanized, but
Speaker 4: it's even better. I'm pretty optimistic on seeing all those
Speaker 4: pieces coming together. And yes we have to go through
Speaker 4: a bit of noise and volatility, but if you should
Speaker 4: really separate the noise from the signal, I think that's
Speaker 4: that's what I really promising.
Speaker 1: That's a great way to end the podcast. So I
Speaker 1: just want to thank you for coming out. It's been
Speaker 1: really refreshing and informative.
Speaker 2: Thank you and Manuel, thank you so much for coming.
Speaker 3: Thank you guys, good to see you job.
Speaker 2: You know, I'm French, or at least I used to
Speaker 2: be French deep at who you talk to, But there
Speaker 2: is this saying in France and in Manuel theerve this
Speaker 2: it's called a.
Speaker 3: Yeah.
Speaker 2: It's an absolute to the force, the sheer side of
Speaker 2: their operation that they built, the three sixty vision, the
Speaker 2: understanding of the dynamics of public market versus private markets,
Speaker 2: the will to develop. Wow, I'm blown away.
Speaker 1: Yeah, I am too, And I must admit I always
Speaker 1: look with a critical eye at what investitors do, right,
Speaker 1: and so if I give you a very simple example,
Speaker 1: they took private this German business in Kaves and in
Speaker 1: Kavas is are renewable developer IPP from Germany. It's been
Speaker 1: around nine and they took it over at such a
Speaker 1: premium to the market price. I thought eight. These guys
Speaker 1: are crazy, but actually they're not, because what it is
Speaker 1: is they see in Kavas as the bedrock of that
Speaker 1: particular platform they're building in that area. So they have
Speaker 1: a very different way of thinking about things. And as
Speaker 1: I said, the more I understand, the more I agree
Speaker 1: with what they're doing. And it's really good for the
Speaker 1: energy transition to have guys like this and that can
Speaker 1: can really create new let's call it new world energy
Speaker 1: services businesses.
Speaker 2: And contrary to what sometimes does infrastructure investor that portrait
Speaker 2: like short term or everything. They have a vision, long
Speaker 2: term vision, but also technical visions, strategic vision. They understand
Speaker 2: the dynamics at the global level, the regions, and and
Speaker 2: then once they have identified a trend and how do
Speaker 2: we invest and scale in that trend. You know, we
Speaker 2: talk a lot about Zeno B but you know, they
Speaker 2: put a billion into Zenoby, which is basically electrifying bus fleets,
Speaker 2: and now they're really all over the place. And of
Speaker 2: course they take advantage of the others platform they have,
Speaker 2: and then when we talk about everything around AI, they
Speaker 2: have five platforms to develop data center, so of course
Speaker 2: they know what's going on. So it's mind blowing.
Speaker 1: Yeah, it'd be interesting to see what comes out of
Speaker 1: the businesses that they're creating. Again, just looking from the outside,
Speaker 1: I think I'm going to have some really impactful businesses
Speaker 1: that they build up over the next few years. So
Speaker 1: I think it's very important to look at their portfolio
Speaker 1: really and what happens with it.
Speaker 2: You know, they have avoided a lot of the hypes.
Speaker 2: They didn't go into sparks, they didn't go into giga factories.
Speaker 2: They didn't go into hydrogen, didn't go into those green premium,
Speaker 2: green steel and so on, so they really understand. These
Speaker 2: are one of the few guys who you know, when
Speaker 2: I took to them, I learned a lot because the
Speaker 2: advantage point is so extraordinary.
Speaker 1: And by the way, people listen to us probably think,
Speaker 1: my god, I on the payroll a khr. Were not
Speaker 1: actually and it's more that both of us just spend
Speaker 1: our time on looking at what investors do. And I
Speaker 1: think we both agree that investors do a lot of
Speaker 1: stupid things in this energy transition, and it's a tough
Speaker 1: place to work in. But I think both of us
Speaker 1: agree that it's just we like this, got their approach right,
Speaker 1: We like their approach and what they're doing.
Speaker 5: Yeah, and e Manuel even disclosed a few things which
Speaker 5: after we had the center tape to the compliance and
Speaker 5: they came back and I had to remove two very
Speaker 5: good minutes which were excellent about the strategy. So you know,
Speaker 5: at some point you hear it must be like the
Speaker 5: thirteen minutes, and I say, oh, now that we reached
Speaker 5: twenty minutes. Yeah, it's done in a very proper way.
Speaker 5: I can't see why they're not going to succeed. We
Speaker 5: interviewed some guys and after five minutes we're like, oh
Speaker 5: my god, I can foresee a lot of reading here. No, no,
Speaker 5: their portfolio is flowless exactly.
Speaker 2: Well. We thank a lot Emanuel for coming on the show.
Speaker 2: We wish wish them the best, but I don't think
Speaker 2: they need our super encouragement.
Speaker 1: I just want to thank the compliance department as well.
Speaker 1: It was really a pleasure working.
Speaker 2: With you, Okay and John. I took to you next
Speaker 2: week next week.
Speaker 1: Thank you for listening to Redefining Energy. Don't forget to
Speaker 1: read the show and subscribe on Apple Podcast, Spotify, or
Speaker 1: the platform of your choice.