After Orange, Greenko plans to buy Skeiron in ₹3,500 crore deal | Mint
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Business News/ Companies / News/  After Orange, Greenko plans to buy Skeiron in 3,500 crore deal
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After Orange, Greenko plans to buy Skeiron in ₹3,500 crore deal

This comes against the backdrop of the Greenko group being poised to buy Orange Renewable from Singapore's AT Capital Group

Greenko Group founder and president Mahesh Kolli (left) and Greenko Group CEO Anil Kumar Chalamalasetty. Photo: Kumar/MintPremium
Greenko Group founder and president Mahesh Kolli (left) and Greenko Group CEO Anil Kumar Chalamalasetty. Photo: Kumar/Mint

New Delhi: The Greenko group, backed by sovereign wealth funds GIC Holdings Pte Ltd and Abu Dhabi Investment Authority, is in talks with Skeiron Renewable Energy to acquire 385 megawatt (MW) of wind projects at an enterprise value of around 3,500 crore. The equity payout is expected to be around 750 crore.

This comes against the backdrop of the Greenko group being poised to buy Orange Renewable from Singapore’s AT Capital Group, in what may rank among the biggest deals in India’s renewable energy space, Mint reported on Monday.

Skeiron is a renewable energy platform set up by Suzlon Energy Ltd along with private equity investors Olympus Capital and Asia Climate Partners. Mint had reported about Suzlon exploring the sale of Skeiron’s wind power assets on 23 May.

India’s wind power tariffs plummeted to 2.43 per kilowatt-hour (kWh) at an auction conducted by state-run Gujarat Urja Vikas Nigam Ltd last December. Also, the country’s wind sector has transitioned from a feed-in tariff regime, which ensures a fixed price for wind power producers, to tariff-based competitive auctions. In such a scenario, obtaining finance at the lowest cost has become key.

The Economic Times newspaper on Monday reported about the Hyderabad-based firm being in final negotiations to buy Skeiron, a private company held by Suzlon founder Tulsi Tanti and his family.

While GIC and ADIA hold 60% and 14%, respectively, in Greenko, founders Kolli and Anil Kumar Chalamalasetty, chief executive and managing director, together hold 26%. GIC and ADIA have invested $1.5 billion so far in the Greenko group.

The Greenko group’s founder, president and joint managing director Mahesh Kolli and a spokesperson for Olympus Capital declined to comment on the Skeiron deal.

Queries emailed to the spokespersons of Skeiron Renewable Energy, Suzlon Energy Ltd and Asia Climate Partners on early Sunday morning were not immediately answered.

Greenko has been aggressively looking at acquisitions for growth and has not participated in India’s solar and wind energy auctions.

“Greenko intends to increase the installed capacity by developing and building new greenfield assets, as well as making selective acquisitions which enhance shareholder value," the company said in a 4 June statement.

An official announcement on the Orange deal is likely to be made shortly. New Delhi-based Orange Renewable was founded by Singapore resident Arvind Tiku.

The Greenko group had in June agreed to acquire Orange Renewable at an enterprise value of around $922 million. Greenko, however, later called off the deal. The deal is now close to fruition at a discount of around $75 million.

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ABOUT THE AUTHOR
Utpal Bhaskar
"Utpal Bhaskar leads Mint's policy and economy coverage. He is part of Mint’s launch team, which he joined as a staff writer in 2006. Widely cited by authors and think-tanks, he has reported extensively on the intersection of India’s policy, polity and corporate space.
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Published: 08 Oct 2018, 01:54 PM IST
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