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Adani Green Energy (AGEL), through its subsidiary Adani Solar Energy AP Six, has raised a project loan facility of ¥27.95 billion (~$205.31 million) to help refinance its debt.
The facility includes amortizing project loans, a 16-year debt structure with a door-to-door tenor of ten years and an average tenor of more than eight years.
It is supported by AGEL’s association with its two core relationship banks– MUFG Bank and Sumitomo Mitsui Banking Corporation, who acted as principal lenders for the facility with equal participation.
The facility is linked to a Japanese benchmark rate gauge – the Tokyo Overnight Average Rate, with close to zero yields, highlights the appeal to diversify the alternative capital pools providing relatively competitive interest rates.
Adani Green aims to have access to long-term capital without impacting its growth assets and continue to look at multiple alternative pools of capital like this one to fund its contribution to India’s clean energy transition.
The company stated that the refinancing facility is consistent with its strategy of securing long-term financing for establishing the debt structure in conformity with the underlying life for its operational assets.
Phuntsok Wangyal, CFO of Adani Green Energy, said, “The facility demonstrates AGEL’s pro-active and continued approach to access liquidity against the backdrop of a challenging interest rate environment in the broader markets, providing the long-term solution. With lower benchmark rate, lesser margin, and historically low swap rates, this provides significant flexibility and a competitively priced funding solution for AGEL’s high-grade renewable asset portfolio.”
Latham & Watkins LLP and Cyril Amarchand Mangaldas acted as legal counsel for the transaction.
Adani Green Energy recorded cash profits of ₹6.01 billion (~$73.98 million) in the second quarter of the financial year 2023, a 50% YoY increase, attributed primarily to the increased sale of power.
Early this year, the company also received an investment of $500 million from the Abu Dhabi-based public joint-stock company International Holding Company PJSC (IHC) out of the total investment of $2 billion in three of Adani Group’s companies.