Shell Eastern Petroleum to acquire 49% stake in Cleantech Solar

Shell Eastern Petroleum is set to acquire a 49% stake in Singapore-based Cleantech Solar that develops, owns and operates commercial and industrial solar energy systems in Southeast Asia and India, and is promoted by former investment banker Raju Shukla. According to an industry source, Shell is likely to infuse $75 million for 49% stake in what would be a cash transaction.

The deal is likely to conclude in January 2019. The investment will be Shell’s second major solar investment this year and will give it two seats on the Cleantech Solar board.

Cleantech Solar owns and operates more than 120 solar power plants across Southeast Asia and India, representing over 200 MW of projects, with the majority being in operation and the rest under construction and development.

Of 200 MW projects, close to 150 MW is in India while the remaining is spread across seven other countries – Singapore, Cambodia, Thailand, Malaysia, Indonesia, Vietnam and the Philippines.

After the completion of the deal, Cleantech will continue to operate under its existing management and name.

Cleantech Solar founder and chairman Shukla told FE over a phone call that he remains confident of crossing the 500 MW-million mark in a few years. “We have built an asset base of $150 million. Around 75% of my portfolio is in India and with the growth that I see, India will continue to be around two-thirds of my portfolio. Growth will happen in Southeast Asia as well.”

Shell has an option to increase its stake in Cleantech after 2021. “What we have agreed on is that three years from now, if Shell is interested in increasing the stake, then I and my group of founding shareholders will look at the transaction at that time,” Shukla said.

Cleantech Solar was founded almost four years back when Shukla decided to take a break from his banking career. What he observed during those times was an increasing awareness among the corporate world about the importance of transition to clean energy. With backing from some of his colleagues, Shukla decided to put up a platform for Southeast Asia and India, primarily taking care of on-site installation for the corporate sector.

Marc van Gerven, Shell vice-president of solar and storage, said, “Asia is a significant commercial and industrial solar generation market for Shell and we are proud to work with Cleantech Solar as a leading solar company in the region,” he said.