List winnowed to Greenko, Sembcorp, Lone Star
Renewable energy players Greenko Energy and Sembcorp Industries together with Lone Star Funds, a US-headquartered PE fund that invests in distressed assets, are understood to have made it to the last lap in the race for SunEdison’s assets in India. Given there are six solar plants and two wind units on offer, each of the three shortlisted bidders could end up with an asset, bankers aware of the sale process said.
US-based SunEdison filed for Chapter 11 bankruptcy in April, revealing in a filing it had assets of $20.7 billion and liabilities of $16.1 billion as on September 30, 2015. The firm has been scouting for buyers for its India assets and has roped in investment banking firm Rothschild to help it transact deals for a combined wind and solar capacity of 1,318 megawatts (MW).
Offers have been invited for both for projects that are running — 350 MW — and also for those under construction — 960 MW. While inviting bids, Rothschild has said in a communique to prospective buyers their proposal must contain the offer price consideration payable to the shareholders and its affiliates, split by special purpose vehicle (SPV) and premium being ascribed to the projects. Details of the capital structure of some of SunEdison’s plants, accessed by FE earlier, had revealed the renewable energy player had infused less than necessary capital into these; of the estimated requirement of R2,010 crore, around 5% or Rs 100.5 crore had been infused. SunEdison had bid the lowest ever solar tariff of R4.63 per unit in November last year for a solar park in Andhra Pradesh to be developed by the state-run NTPC. In the following month, however, Finnish company Fortum won projects in Madhya Pradesh at an even lower tariff of R4.34 per unit.
Hyderabad-based Greenko Energy Holdings is owned by Singapore’s GIC and recently raised $230 million from Abu Dhabi Investment Authority (ADIA).
The company has announced plans to expand renewable energy projects. Lone Star is building its India energy portfolio and is believed to be close to finalising an investment in a thermal unit.
The Singapore-based Sembcorp Green Infra, a subsidiary of Sembcorp Industries, has over 900 MW of wind and solar power assets in operation and under development in southern, western and central India. Last year, it acquired a controlling stake in Green Infra from IDFC Alternatives for R1,060 crore, marking its entry into India’s renewable energy market.
Emails sent to Lone Star Funds and to Greenko Energy remained unanswered till the time of going to press. Pashupathy Gopalan, Sun Edison India CEO, responded saying, “Unfortunately, these are confidential processes we are running and I am unable to comment on this.” A Sembcorp spokesperson replied saying, “India is one of Sembcorp’s key markets and an integral part of the company’s emerging market strategy. We are constantly on a lookout for suitable opportunities to grow our business in India especially in the areas of thermal power, renewable power, water treatment and urban development. However, we do not comment on any specific opportunities.”