Hindustan Clean Energy raises $130 mn from Farallon Capital, BofAML
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Hindustan Clean Energy Ltd (HCEL), the renewable energy arm of Hindustan Power Projects Pvt. Ltd (HPPPL), has raised $130 million in debt funding from US-based hedge fund Farallon Capital Management and Bank of America Merrill Lynch (BofAML), two people aware of the development said.
“HPPPL was in talks with the lenders for a while and closed the transaction around three months ago. It was also exploring options to sell an equity stake alongside,” one of the two people said on condition of anonymity as he is not authorized to speak to the media.
“Around half of the capital raised will go towards refinancing the company’s existing loans and the rest will be used for funding new projects,” the second person said, also on condition of anonymity.
“The mentioned fund raise is growth capital used for capacity expansion towards sustaining its pioneering efforts in the solar space,” the spokesperson of HPPPL said.
“The company to its credit set up India’s first 5MW (megawatt) and Asia’s first and then largest 30MW solar farm. Recently, the company commissioned the north-east’s first 5MW solar farm in Assam,” the spokesperson added.
San Francisco-based Farallon Capital Management is among the early foreign investors in India and has in the past invested in Indiabulls Real Estate.
The company currently has $21.5 billion of assets under management.
The firm closed a $1.12-billion special situations fund focused on Asia and Latin America in July and is also considering an investment in Essar Steel.
HCEL was established in 2008 to develop renewable energy projects in India and abroad.
According to the company’s website, it has Rs6,000 crore in assets.
HPPPL, formerly known as Moser Baer Projects Pvt. Ltd, is promoted by Ratul Puri, son of Moser Baer group founder Deepak Puri.
The company has 600MW of solar capacity spread across several states, including Tamil Nadu, Punjab, Gujarat, Assam and Uttar Pradesh.
According to industry analysts, the company has signed power purchase agreements (PPAs) for almost all of its commissioned projects. The company’s newer PPAs have been signed on the preferential-tariff model.
HPPPL has recently commissioned a 1,200MW thermal power plant at Anuppur in Madhya Pradesh.
Mint had reported on HPPL’s plans to sell equity stake in solar assets in September. The plans were aimed at providing investors exit options and refinancing a part of its debt.
In 2010, private equity giant Blackstone invested about $300 million in the company and holds close to 30% stake.
In April, Mint had reported on HPPPL’s plans to go public by 2017, citing the company’s chairman. Puri had said that the company could tap the primary markets next year, depending on the incremental capital requirement.