Suzlon Energy Ltd promoters, the Tanti Group, has announced plans to foray into China as a developer of wind farms. The Tantis are not making this investment though Suzlon Energy but through Colossus Holdings, which is their privately held investment and holding company. Colossus will get into a 24:76 JV with Arcapita Bank, an investment firm headquartered in Bahrain for this Chinese wind market foray. The JV together would invest US $ 2 billion by 2012 to develop 1,650 MW of wind capacity in China.
As a first step towards these plans, Colossus Holdings, Singapore has acquired Honiton Energy Holdings plc. The JV venture partners have signed a definitive purchase agreement to acquire Honiton. This will be a US$500 million deal of which Colossus will put in US$100 million.
Established in 2005 to develop and operate wind power generation facilities within China, Honiton has 50 MW of installed capacity, and a further 100 MW in development. Honiton has secured agreements to develop wind farms on five separate areas in China, representing a total of 2,244 square kilometres, on which it plans to develop its total capacity to reach 1,650 MW by 2012.
Suzlon is currently present in China as an integrated wind turbine manufacturer with 600 MW capacity. Suzlon Energy (Tianjin) Ltd is a wholly-owned subsidiary of Suzlon Energy Ltd, India and is a pure play equipment supplier. It has secured orders totaling nearly 200 MW of capacity for wind farm projects in China. Honiton is one of the customers of Suzlon and it is doing about 50 MW of Honiton?s projects.
But this new venture through the privately held Colossus Holdings will be `an arms length investment? and may or may not leverage Suzlon?s manufacturing base in China, Suzlon said.
According to Tulsi R Tanti, director, Colossus Holdings, said Honiton, had developed an excellent pipeline of projects and was backed by a strong management team which provides them with a good opportunity to further their interests in the wind energy sector along with Arcapita. ?This investment reinforces our belief in the exponential growth potential of wind energy in developing markets like China and India,? Tanti said.