SoftBank has been holding discussions with a group of sovereign wealth and pension funds from the Far East and Gulf regions, some of whom are limited partners (LPs) of SoftBank Vision Fund, besides Silicon Valley based technology giants that are big buyers of clean energy.
MUMBAI: Amid major global setbacks, Masayoshi Son’s SoftBank is exploring to bring on board a partner in its high-profile renewables joint venture in India, SBG Cleantech, by selling a majority stake, said people in the know. This is part of an ongoing review of its businesses around the world in a bid to increase liquidity.
SoftBank has been holding discussions with a group of sovereign wealth and pension funds from the Far East and Gulf regions, some of whom are limited partners (LPs) of SoftBank Vision Fund, besides Silicon Valley based technology giants that are big buyers of clean energy, these people said.
The Japanese technology and telecoms major is considering various options, ranging from an outright sale of its 70% stake to a majority stake sale. In essence, it is looking at a partner which can provide equity commitments of $1.5-2 billion to execute and complete a pipeline of 7 GW of renewable projects around the world, the people said, adding more suitors may emerge. However, the talks are still at an early stage and may not result in a deal.
Analysts say SoftBank so far has invested $500-600 million in the Indian JV.
A SoftBank spokesperson declined to comment on what she described as speculation. Mails sent to Bharti and Foxconn did not generate a response till press time on Wednesday.
The clean energy platform predominantly has operating assets in India but has also globally diversified across US, Latin America and Middle East through acquisitions and bidding.
The entire global portfolio, except Japan — which is owned by a separate SoftBank entity — could potentially be divested.
“After Abu Dhabi Investment Authority (ADIA), Singapore’s GIC or the Canadian pension funds such as CPPIB and CDPQ, several of their peers from around the world like Mubadala are exploring the India clean tech space in a big way,” said one of the officials directly involved in the ongoing negotiations. “Many of them have relationships with the larger SoftBank Group or the Vision Fund and do not want to miss out.”
One of the people mentioned above said Silicon Valley giant Google would also be tapped but this could not be independently verified. Last September, Google had revealed a $2 billion wind and solar investment plan that included clean energy supply agreements worldwide.
GREEN & CLEAN
In 2015, amid much fanfare, SoftBank had teamed up with Bharti Enterprises and Taiwan’s Foxconn Technology Group to form a 70:10:20 alliance to build solar and wind parks and subsequently start manufacturing panels in India to promote Prime Minister Narendra Modi’s push for clean energy and Make in India initiatives. Together they were to invest $20 billion over a 10-year period to set up 20,000 MW, or 20 GW, of clean energy projects, subject to certain conditions.
But its India play so far has been mixed. It bid aggressively for contracts by Solar Energy Corporation of India (SECI) and NTPC to bulk up a portfolio of near 1.5 GWs of operating assets with a pipeline of another 2.5 GW. The operating projects have an estimated $900 million to a billion dollars of leverage, add industry players. Read More…