Dilip Shanghvi to buy 23% Suzlon Energy stake for R1,800 crore

By: | Published: February 15, 2015 12:59 AM

Indian billionaire Dilip Shanghvi agreed to buy 23% of Suzlon Energy for R1,800 crore as Asia’s second-biggest...

Indian billionaire Dilip Shanghvi agreed to buy 23% of Suzlon Energy for R1,800 crore as Asia’s second-biggest wind-turbine maker raises money to revamp debt. The Tanti family will hold 24% shares and will retain management control by virtue of pooling arrangement for voting.

Suzlon will use the proceeds to pare borrowings as it focuses on growth in India as well as the US, China, Brazil and other key nations. Shanghvi, India’s second-richest man with a net worth of almost $20 billion, is the largest shareholder of Sun Pharmaceutical Industries.

Part of the proceeds will also be used to develop technologies, Suzlon chairman Tulsi Tanti said. “We’ve been struggling for the past two years,” Tanti said. “Our first step was to exit Senvion and with this transaction, we will be able to accelerate growth.”

The investment by Shanghvi will help Suzlon mend strained finances after it suffered India’s biggest convertible-bond default in 2012. This deal comes less than a month after it agreed to sell its German unit Senvion for $1.1 billion to Centerbridge Partners.

The company, whose debt surged 30% to R17,300 crore in three years to September, is seeking to emerge from a debt revamp programme by March.

Suzlon on Saturday reported a widening of consolidated net loss at R6,538.68 crore for the third-quarter ended December 2014 on the back of sale of Senvion. It had reported a loss of R1,075.25 crore in the corresponding period a year ago. Its total income declined to R4,977.18 crore during the October-December quarter against R5,052.2 crore in the third quarter of FY14.

Dilip Shanghvi said this financial investment was in sync with the Prime Minister’s long-term vision and immense potential of the renewable energy market.


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