The renewable energy sector has been witnessing a momentum in mid-sized mergers and acquisitions, with the RP-Sanjiv Goenka (RPSG) Group being the latest to jump on the bandwagon with the proposed Rs 4,859-crore acquisition of 1.4 GW solar portfolio from ReNew Solar Power .
At least half a dozen deals, each valued between $350 million and $600 million, have come through in the past six months as the sector is in a consolidation phase and companies look to scale up their portfolios through inorganic route.
The latest acquisition is expected to accelerate the RP-Sanjiv Goenka Group’s ambition of building a 10 GW renewable energy platform in the next few years. Its power arm CESC announced the acquisition of 1.4 GWp operating solar portfolio from ReNew Solar Power held across six project special purpose vehicles in Rajasthan and Karnataka at an enterprise value of `4,859 crore.
In June, Inox Clean Energy announced the acquisition of Vena Energy India’s 6 GW renewable energy portfolio, valuing the latter at Rs 6,000 crore. Prior to that, it bought Vibrant Energy from Macquarie Corporate Holdings at a valuation of Rs 5,000 crore. The INOXGFL Group also acquired the IPP and operations & maintenance (O&M) businesses of Wind World India through an NCLT-approved resolution process for about Rs 2,775 crore. The group is targeting 10 GW of installed renewable IPP capacity, alongside 11 GW of integrated solar manufacturing capacity, by FY28.
Last month, global investor Brookfield launched a new renewable energy platform in India called Lumara, which will deploy about $600 million to fast-track solar, wind and battery storage projects, backed by an initial portfolio of more than 6 GW of capacity.
Strategic Benefits
Such deals help accelerate growth of renewable portfolio and expand the scale, promoters have said. Shashwat Goenka, vice chairman, RPSG Group, said, “This acquisition marks a significant acceleration of our renewable energy journey. It gives us immediate operating scale, complements our strong pipeline of contracted capacity, and meaningfully brings forward the growth of the platform.” After the deal, the contracted capacity of CESC arm Purvah Green Power will go from nearly 3.4 GWp to 4.8GWp, of which 1.8 GWp is operational and 3 GWp is at various stages of construction.
Goenka said the acquisition substantially increases the proportion of the portfolio that is already generating revenue and strengthening recurring cash flows well ahead of the commissioning schedule for the under-construction pipeline.
Experts said the industry is going through a consolidation phase and such deals are expected to pick up further. “Also smaller deals are easier to fund and execute,” said a banker who did not want to named. The pace of renewable energy addition also looks promising. The country has crossed 300 GW of installed non-fossil electricity capacity, and is aiming a capacity of 500 GW by 2030.