German company Danpower Group and Estonian energy firm SW Energia have announced a strategic partnership, under which Danpower will acquire a majority stake in SW Energia, subject to approval by the Estonian Competition Authority. The transaction supports SW Energia’s accelerated growth in foreign markets and the transition of Estonia’s district heating sector toward renewable energy.
In Danpower’s assessment, Estonia has been an attractive investment destination for years. According to Burkhard Vogel, member of the management board of Danpower Eesti AS, when the company entered Estonia in 2012, the country was still relatively unfamiliar to many. Today, however, that has changed.
“We feel at home in Estonia and in many respects even see advantages here compared to our home market Germany. We perceive the investment climate as exceptionally stable and reliable, and we are convinced that it is understood here that prosperity, security and environmental protection are only possible when companies feel comfortable and invest,” said Vogel. He added that Danpower particularly values Estonia’s business-friendly, investment-supporting tax system as well as the political support the company has experienced while operating in the country.
Vogel also highlighted the role of the state in supporting foreign investors. “From the very beginning, we have felt welcome in Estonia. The Enterprise Estonia has been at our side, helping us establish important contacts in both political and business circles,” he noted.
Partnership is powering Estonia’s carbon‑neutral future
The objective of the partnership is to combine the strongest assets of both companies: SW Energia’s strong local expertise and agile management, and Danpower Group’s international experience, financial strength, and long-term investment perspective. The cooperation establishes a solid platorm for large-scale investments in the modernization and development of Estonia’s heat supply infrastructure, as well as for the implementation of new, environmentally friendly energy solutions.
“Through this merger, our combined financial and development capabilities increase significantly, enabling us to realize our ambitious vision—to make carbon-neutral district heating the standard across Estonia.”
Burkhard Vogel, CEO of Danpower Estonia
“This step provides SW Energia with a clear competitive advantage, allowing us to operate faster and at greater scale, further strengthening our position,” said Allan Aas, CEO of SW Energia, who will continue to lead the company following the merger.
“Everything that has worked well so far will continue. My role as CEO and our team’s operating principles remains the same, but we now have greater resources to invest in renewable energy, further develop the use of domestically sourced wood fuel, and provide our customers with an even more reliable and higher-quality service,” he added.
SW Energia’s partnership means environmentally friendly solutions
For SW Energia’s current and future customers, the partnership means an even more innovative, environmentally friendly, and sustainable heat energy service, along with long-term security of supply. For employees, becoming part of an international group creates new development opportunities, professional challenges and career growth.
The company name, brand, operating model, and management of SW Energia will continue as they are, no immediate changes are planned. The company’s founding members and CEO Allan Aas will continue in their current roles, ensuring continuity, stability, and a clear strategic direction for the future.
“Through this merger, our combined financial and development capabilities increase significantly, enabling us to realize our ambitious vision—to make carbon-neutral district heating the standard across Estonia,” commented Burkhard Vogel, CEO of Danpower Estonia.
Riina Leminsky, Foreign Investment Adviser in Germany at the Enterprise Estonia, describes Danpower’s investment as long-term and responsible. According to her, the company has grown into an important contributor to local development in Estonia, working closely with local authorities, supporting sports and the activities of the Defence League, and creating high-quality jobs in Võru, including a German-language customer service centre.
“My cooperation with Danpower began already during the investor search phase and included preparing and implementing the investment decision. Even after the transaction, I have continued to support the company’s expansion and help resolve challenges in cooperation with state and local institutions,” Leminsky said, adding that this long-term cooperation has given a new boost to the company’s growth.
The company generates energy across 65 district heating networks in Estonia
SW Energia OÜ, founded in 1999, has grown into one of the fastest-developing heat energy companies in Estonia. The company produces thermal energy in 65 district heating networks across the country, offering customers a comprehensive full-service heat supply solution. The company’s development to date has been based on strong local leadership, efficient digital management, and the consistent use of renewable energy sources.
“Everything that has worked well so far will continue. My role as CEO and our team’s operating principles remains the same, but we now have greater resources to invest in renewable energy, further develop the use of domestically sourced wood fuel, and provide our customers with an even more reliable and higher-quality service.”
Allan Aas, CEO of SW Energia
Danpower Group, headquartered in Potsdam, Germany, has extensive and long-standing experience in the heat and renewable energy sector. The company’s activities include the development, construction, and operation of district heating and energy solutions for industrial companies, cities, residential areas, and commercial clients. Danpower has been active in Estonia since 2012, providing district heating services to the city of Võru and surrounding residential areas.
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