Tata Power, the country’s largest integrated private power player, on Tuesday said it would acquire BP Alternative Energy Holding’s 51% stake in joint venture Tata BP Solar. The decision was made days after BP decided to exit its 40-year old solar business.
Though financial details of the deal were not disclosed, Tata BP Solar will continue to access some BP technology until 2013 through a separate agreement and, on completion of the transaction, Tata Power will own 100% of the company. Tata Power shares rose 2.4% on the announcement at R90.55 in a weak Mumbai market.
The JV manufactures solar photovoltaic cells, solar modules, products and systems at its plants in Bangalore and offers solar power applications, such as village lighting, water pumping as well as for businesses such as telecommunications, railways, banks and defence establishments.
?We believe that the favourable policy environment in India has led to an increase in the size of the solar module and solar cell market in India and is a great opportunity for the company to grow and capture a healthy market share. We would also like to reiterate that Tata BP Solar is not impacted by the decision of BP to gradually exit its solar business and that it is business as usual for them,? said Anil Sardana, managing director, Tata Power.
?We are still committed to the $8-billion investment in alternative energies ? US onshore wind, and biofuels R&D, manufacturing, blending and marketing – from 2005-15. In fact, we are likely to reach there a couple of years early,? said spokesperson for BP, Europe’s second largest oil company.
The JV was incorporated in 1989 for manufacturing photovoltaic cells and modules and BP holds a 51% stake in the share capital of the JV. The Rs 906-crore venture has a 125 MW solar module manufacturing capacity, along with an all-India network of eight regional offices and 150 dealers and service centres and an employee strength of 600.
Further, to provide for a smooth transition in respect of branding and fulfilment of recertification requirements for solar PV modules, Tata Power and BP have agreed for a transition period for product and non-product related rebranding and certification.