Clean energy IPP (independent power producer), Greenko Energy Holdings, is all set to close one of the biggest transactions in the renewable energy sector in the country, acquiring about 1400 MW capacity of SunEdison’s assets in India. These projects entail a total outlay of about $1.2 billion. The transaction is poised to be concluded within a fortnight as the company is also in the process of concluding a major debt transaction to fuel its acquisition and business plans, sources close to the development requesting anonymity said.
Greenko Energy, which was listed on the AIM of the London Stock Exchange, has taken a lead over others in the fray to acquire these assets spread across many states in the country. It is backed by two sovereign fund-backed entities, GIC of Singapore and Abu Dhabi Investment Authority. While GIC acquired a major stake in Greenko from the promoters Anil Kumar Chalamalasetty and Mahesh Kolli, Abu Dhabi Investment Authority pumped in $230 million earlier this year.
The US-based SunEdison had filed for bankruptcy under Chapter 11 earlier this year. The firm is in the process of divesting its assets globally, including in India where it has assets close to 1400 MW. This includes 500 MW of operational and about 900 MW of assets under development. SunEdison has hired Rothschild Inc. and McKinsey Recovery & Transformation Services U.S., LLC as advisors for the restructuring process.
This deal when consummated will be amongst the largest in the country. Earlier this year, Tata Renewables, a Tata Power subsidiary, acquired 1.1 giga watt assets from Welspun Energy. The renewable energy sector has begun to see a number of mergers and acquisitions in recent times, including Sembcorp consolidating its presence in India by acquiring additional stake from IDFC Alternatives-backed Green Infra, and the China Light Power arm acquiring stake in solar assets promoted by Suzlon Energy in Telangana. The market is abuzz with potential buyouts in the sector.
With SunEdision bagging a number of projects in India, some of them at an aggressive pricing of below Rs. 5 a unit, its assets are being closely tracked for potential buyout. And in the race towards consolidating its business in India, Greenko, which already has total installed capacity of over 1 giga watt, and has a strong pipeline in its fold, will see a major boost to its capacity once it closes the SunEdison deal.
When contacted, the promoters of the company refrained from commenting on the transaction. In June this year Greenko raised equity of $230 million and is close to clinching a major financial transaction. Together, these will play a big role in part-funding the mega acquisition.