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Business News/ Companies / News/  CPPIB is majority owner of ReNew
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CPPIB is majority owner of ReNew

Goldman Sachs sells remaining stake to Canada fund for $268.6 mn

Post the transaction, CPPIB‘s stake in ReNew is up to 51.6%.Premium
Post the transaction, CPPIB‘s stake in ReNew is up to 51.6%.

New Delhi: Canada Pension Plan Investment Board (CPPIB) has become the majority owner of ReNew Energy Global plc with it agreeing to buy $268.6 million worth of shares from Goldman Sachs on 2 March.

The transaction was completed at a per-share price of $4.8, according to a recent regulatory filing.

Post the transaction, CPPIB owns over 76 million Class A shares, one Class D share and over 118.363 million Class C shares, taking its total economic interest to 51.6%.

CPPIB has significant investments in the renewable space. The group holds a diversified portfolio, primarily long-term tangible assets, including renewable energy sources such as wind, solar and hydro, as well as conventional power, upstream oil and gas, energy midstream, carbon capture and liquefied natural gas.

ReNew has different classes of shares, with voting rights only vested with Class A shares.

This is not the first share sale by Goldman Sachs in ReNew to the Canadian pension fund. Once the single-largest shareholder in ReNew Power, it has been offloading its shares of late. In February, it sold 18 million Class A shares and 3.4 million Class C shares at $6.5 per share to CPPIB for $139 million.

Goldman Sachs made its initial investment in ReNew in 2011 with an investment of 1,000 crore investment.

The recent stake sale comes in a bid to comply with US laws which bar financial institutions from owning securities in any company beyond 10 years.

Other institutional investors in the company include Abu Dhabi Investment Authority, JERA and Global Environment Fund.

Commenting on the development, Moody’s Investors Service said: “Completion of CPPIB’s announced acquisition of an additional 14% stake in ReNew Energy Global, the Nasdaq-listed parent of ReNew Power Pvt. Ltd, would be credit positive for RPPL, as it provides more visibility into RPPL’s long-term shareholder structure.“

“Any final rating impact will depend on how the change in shareholder mix–with CPPIB holding an economic shareholding of over 51% in ReNew Energy Global–may affect the likelihood of shareholder support being provided to RPPL if required, the group’s growth, as well as the associated funding strategy," it said.

The stake sale comes at a time ReNew is planning to sell a minority stake in its commercial and industrial (C&I) projects for around $300 million as part of its capital recycling strategy. Last month, Mint reported that ReNew Energy Global Plc has been looking at several opportunities as part of its capital recycling strategy.

Further, in August, Mint reported that Malaysia’s Petroliam Nasional Bhd, or Petronas, may purchase a 49% stake in ReNew at the project level.

In line with its strategy to focus on the overall clean energy ecosystem, ReNew has been involved in the development of emerging decarbonization solutions like green hydrogen, energy storage, carbon markets, and solar manufacturing and is poised to further the net-zero transition goals.

Last month, ReNew Power rebranded itself as ReNew in a bid to reflect the company’s transition from being a pure-play renewable independent power producer to an end-to-end provider of solutions across the decarbonization spectrum.

ReNew was listed on the NASDAQ in 2021 at a valuation of $4.5 billion through the SPAC (special purpose acquisition company) route. Shares of the company on the Nasdaq currently stand at $4.545, lower by 0.11% from its previous close, and its market capitalization stands at $1.76 billion.

Queries sent to spokespeople ReNew, Goldman Sachs remained unanswered till press time. Responding to a mail from Mint, a CPPIB spokesperson said: “We don’t have any further comment other than information contained in the SEC filings. “

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Rituraj Baruah
Rituraj Baruah is a senior correspondent at Mint, reporting on housing, urban affairs, small businesses and energy. He has reported on diverse sectors over the last six years including, commodities and stocks market, insolvency and real estate. He has previous stints at Cogencis Information Services, Indo-Asian News Service (IANS) and Inc42.
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Updated: 07 Mar 2023, 06:34 AM IST
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