Virescent has 317 MW solar projects in Maharashtra and Tamil Nadu, also entered into definitive agreements to acquire operating solar projects across three states
NEW DELHI: Private equity firm KKR has announced the launch of its renewable energy platform--Virescent Infrastructure--to acquire green energy assets in India.
India’s green economy has attracted a bevy of investors ranging from private equity funds, pension funds, strategic players among others. Earlier this year, European alternative asset manager EQT and Singapore’s state investment firm Temasek Holdings Pte. jointly set up O2 Power, a $500-million renewable energy platform in India.
This development comes in the backdrop of KKR making its foray in India’s green energy space. Virescent has 317 megawatt (MW) solar projects in Maharashtra and Tamil Nadu. KKR was earlier engaged in acquiring green energy producer Mytrah Energy India Pvt. Ltd, but the proposed $750-million deal fell through.
Other global investors in India’s clean energy space include Goldman Sachs, Brookfield, SoftBank, Canada Pension Plan Investment Board, Caisse de dйpфt et placement du Quйbec, JERA Co. Inc., GIC Holdings Pte Ltd, Global Infrastructure Partners, CDC Group Plc, EverSource Capital and the World Bank’s International Finance Corp.
“KKR has also entered into definitive agreements to acquire other operating solar projects across three different states. Once closed, these projects will also become part of the Virescent platform," KKR said in a statement.
The platform is headed by chief executive officer Sanjay Grewal. KKR has invested globally in renewable energy businesses and has a 10 GW operational capacity. Its other investments in India are in companies such as; Reliance Jio, Reliance Retail, IndiGrid, JB Chemicals, Max Healthcare and Ramky Envirotech.
There has been rapid pace of clean energy capacity addition by India. Clean energy projects now account for more than a fifth of India’s installed power generation capacity. India now has 34.6 GW of solar power and 38GW of wind power and seeks to produce 100 GW from solar projects and 60GW from wind power plants by March 2022. The country is seeking additional clean energy investment of around $80 billion till 2022, growing more than threefold to $250 billion during 2023-30.
“Headquartered in Mumbai, Virescent aims to expand its diversified portfolio of operational renewable energy assets, facilitated by investments predominantly made through KKR’s infrastructure fund. Virescent looks to identify investment opportunities that have stable cash flows stemming from long-term contracts with state and central government counterparties across India," the statement said.
Despite the coronavirus pandemic, deal activity continues unabated in India’ green energy space. Recently the single-largest foreign clean energy investment announcement in India was made by Japan’s ORIX Corp. for $980 million in Greenko for a 17% stake.
Other potential deals and transactions in the works as reported by Mint include; Warburg Pincus Llc is exploring the sale of its stake in rooftop solar power company Cleanmax, Hyderabad-based green energy producer Mytrah Energy India Pvt. Ltd restarting the majority stake sale process in the firm, and Goldman Sachs backed ReNew Power Ventures Pvt. Ltd exploring an overseas listing.
Also, Acme Solar looking to sell 4.84 GW of solar projects; Petronas is looking to acquire around 10% stake in Tata Power Renewable Energy Ltd, in addition to investing in Tata Power’ renewable energy InvIT, and Avaada Energy has mandated Bank of America (BofA) for selling stake.
In addition; O2 Power and Ayana Renewable Power have emerged as the front-runners to acquire Azure Power’ 305 MW solar assets; Canada Pension Plan Investment Board, Actis Llp and Brookfield Asset Management Inc. are looking to buy Japan’s SoftBank Group Corp’s stake in SB Energy Holding and EverSource Capital’ plans to buy out the entire 167 MW solar rooftop portfolio of NYSE-listed Azure Power Global.
“We are thrilled that Virescent will seek to invest in many of these great opportunities, in addition to achieving stable returns by acquiring high-quality, low-risk, and income- yielding assets with stable and long-term cashflows," Grewal said in the statement.