Greenko Group and Hero Future Energies Pvt. Ltd are separately looking to acquire Subhash Chandra’s Essel Infraprojects’ solar business, according to two people aware of the development.
“The Essel solar deal may rank amongst the largest clean energy deals in India’s renewable energy space," said one of the two people cited above, requesting anonymity.
Greenko and Hero Future Energies are looking to rapidly expand their capacities as a wave of consolidation is sweeping through India’s clean energy industry, even as low-cost financing has become the key to success after solar and wind power tariffs plunged to record lows.
India’s large green energy deals include Tata Power Co. Ltd acquiring the entire 1.1 gigawatt (GW) renewable energy portfolio of Welspun Energy Ltd for $1.4 billion and Greenko Energies Pvt. Ltd—backed by Singapore’s sovereign wealth fund GIC Holdings Pte and the Abu Dhabi Investment Authority—acquiring SunEdison Inc.’s Indian assets for $392 million in 2016. Also, in the largest global clean energy acquisition till date, Global Infrastructure Partners led a group of investors that last year announced plans to buy Equis Energy for $5 billion. The sale includes the Indian portfolio of the Singapore-based renewable energy developer comprising green energy platforms Energon and Energon Soleq.
Mint reported on 19 October about Essel Infraprojects Ltd mandating Investec to find a buyer for its solar business. Essel Infraprojects has a presence across green energy, transportation, electricity transmission and distribution, and urban infrastructure.
Queries emailed to Ajeeth Narayan, head of the Indian unit of Investec, remained unanswered.
Hyderabad-based Greenko Group is in talks with Essel Infraprojects to acquire its power transmission business for an estimated $1 billion, Mint reported on 15 January.
Essel Infraprojects has 685 megawatts (MW) of solar capacity, of which 165MW is operational. An additional 520MW of solar projects are under construction at various stages in Uttar Pradesh, Odisha and Karnataka.
“As an infrastructure conglomerate, we keep on evaluating various opportunities to enhance our shareholders’ value creation. However, we would like to refrain from commenting on any market driven speculative stories," an Essel Group spokesperson said in an emailed response to a query.
While queries emailed to a Greenko Group spokesperson remained unanswered, a Hero Future Energies spokesperson in an emailed response said, “The company will like to maintain its policy of not commenting on rumours except as required by law."
Hero Future Energies has an operational asset base of 1,200MW across wind, solar grid-connected and rooftop plants. Greenko Group currently has over 3.2GW of operating capacity, with plans to reach 5GW by 2019. It has been looking at inorganic growth to ramp up its portfolio and acquired SunEdison’s Indian assets in 2016.
The big deals that are lined up by India’s largest clean energy firms, and reported by Mint, include ReNew Power Ventures Pvt. Ltd’s planned acquisition of global private equity firm Actis Llp’s Ostro Energy Pvt. Ltd, and Hero Future Energies looking to buy Orange Renewable from Singapore-based AT Capital.