The talks with Statkraft began towards the end of 2019 and were in progress.
Mumbai: The buyout discussion between Norway’s state-owned renewable energy major Statkraft and India-focused Continuum Wind Energy is on the verge of collapse. Statkraft has decided to put their talks to acquire Morgan Stanley Infrastructure Partners-owned Continuum on hold, citing revenue fall and expected impact of prolonged lockdown, said multiple people aware of the development.
In 2012, Morgan Stanley had invested $212 million in Continuum Wind, a clean energy company founded in 2009 by Arvind Bansal and Vikash Saraf. Continuum has a current portfolio of about 2 GW, out of which 552 MW is already operational and 628 MW is in construction. Continuum’s current projects are located in Gujarat, Maharashtra, Madhya Pradesh and Tamil Nadu.
The talks with Statkraft began towards the end of 2019 and were in progress. However, the lockdown and the uncertainty over the revenue from existng PPAs hampered the talks, said one of the persons cited above. Statkraft, which entered India in 2004, had acquired 100 MW Tidong hydropower project in Himachal Pradesh in 2018.
Arvind Bansal, founder & CEO of Continuum, and a Statkraft spokesperson declined to comment while mails sent to Morgan Stanley did not elicit any response till press time.
KPMG and global investment bank Moelis were running deal mandates.
Since 2015, Morgan Stanley Infrastructure Partners has been trying to sell Continuum and engaged in discussions with potential buyers such as SunEdison and Canada’s Brookfield but the talks never materialised.
In June 2015, SunEdison had signed a definitive agreement to acquire Continuum with assets in India but the company decided to terminate the agreement in November 2015.
Later, founder Arvind Bansal had sought the backing of PE funds to acquire stake from Morgan Stanley, which also did not fructify. Talks with Canadian funds including Brookfield Asset Management also didn’t succeed.
“The wind power sector is facing significant challenges because of the delays in making payments by the state distribution utilities and the execution delays being faced by the projects bid out by the central nodal agencies and state distribution utilities,” said a recent report from ICRA. This apart, the tariff uncertainty for the wind power projects in Andhra Pradesh has affected investor sentiments in the sector. This is also reflected in the slowdown in the tendering activity of wind power projects by 67 per cent to 2.3 GW in CY2019 from 6.9 GW in CY2018.
Source: economictimes.indiatimes
