Mahindra & Mahindra (M&M) said it will acquire 1.60 crore shares (up to 31.2% stake) in ReNew Sunlight Energy (RSEPL), in one or more tranches, for a cash consideration of Rs 16.07 crore.
RSEPL is subsidiary of ReNew Green Energy Solutions, which in turn is a subsidiary of Renew Power.
Pursuant to the above acquisition of shares, RSEPL will become an associate of the company, M&M said in a statement.
RSEPL will build, own and operate captive solar power plant having capacity of 58 MWp to generate around 100 million units a year and feed it into the MSEDCL grid.
Subscription of equity shares in RSEPL will enable M&M to become captive user and consume solar power generated by RSEPL. Accordingly, the company has also signed a power delivery agreement with RSEPL.
Under the open access arrangement of the company with the electricity distribution companies, the manufacturing plants of the company in Maharashtra will consume the said solar power generated.
The company expects to complete the transaction by 31 December 2021.
M&M’s business is diversified across farm equipment, auto and automotive components, real estate, hospitality, information technology, defence and aerospace and financial services.
The company reported a net profit of Rs 162.54 crore in Q4 FY21 as against a net loss of Rs 3255.02 crore in Q4 FY20. Net revenue from operations increased by 48.1% year-on-year (YoY) to Rs 13,338.15 crore during the quarter.
The scrip fell 1.13% to currently trade at Rs 772.50 on the BSE.