Shares in UK energy infrastructure company Smart Metering Systems are soaring after US private equity firm KKR made a GBP 1.3bn bid to buy the company.

Smart Metering Systems shares rose 41% to 957 pence on the London Stock Exchange.

The increase also beats the transaction value of 955 pence per share, representing a 40.4% premium over Wednesday’s closing price of 680 pence.

The deal values the Glasgow-based company at 20 times the earnings before interest, taxes, depreciation and amortization (EBITDA) and is expected to close in the first quarter of next year.

KKR believes that Smart Metering Systems has the potential to significantly contribute to and enable the energy transition.

Further, KKR points out that Smart Metering Systems represents an established smart metering platform with a growing capability in grid-scale battery storage assets and other carbon reduction activities.

KKR also expects Smart Metering Systems to play a leading role in supporting the UK government’s ambition to be net zero by 2050.