Greenko Energy Holdings (Greenko) has completed the acquisition of SunEdison’s 587 MW Indian wind and solar projects for a cash payment of $42 million and assumption of project-level debt of $350 million (at an average interest rate of 11.3 percent). The enterprise value of the transaction is approximately $392 million.
According to Mercom’s research, Greenko’s acquisition of SunEdison’s India assets include 48 MW of wind projects, 214 MW of operational solar projects, 325 MW of solar projects in various stages of development and 900 MW of pre-construction projects in pipeline which it might choose to develop in the future.
Mercom had previously reported that Singapore government’s sovereign wealth fund (GIC) acquired a majority stake in Greenko Group’s Mauritius entity (Greenko Energy Holdings) for $213.3 million in October of 2015. Greenko also raised $230 million in capital from Abu Dhabi Investment Authority and GIC in June of this year.
“The proposed acquisition of SunEdison’s India assets is expected to immediately accelerate capacity, revenue, EBITDA growth and drive overall earnings growth potential for Greenko and its stakeholders,” said Anil Chalamalasetty, Managing Director and chief executive officer, Greenko.
The solar projects acquired from SunEdison include the entire operational portfolio in Tamil Nadu, Karnataka, Telangana, Andhra Pradesh and a 1 MW rooftop solar project in Uttar Pradesh.
As reported by Fitch Ratings, “Greenko may eventually allocate the acquired assets to its two restricted groups that were created to raise U.S. dollar debt in the capital markets – Greenko Dutch BV ($550 million 8% senior notes due 2019 rated ‘B+’; capacity of 623MW) and Greenko Investment Company ($500 million 4.875% senior notes due 2023 rated ‘B+’; capacity of 403MW), subject to terms and conditions in the bond indentures, including debt to EBITDA incurrence tests. Greenko may be able to reduce the interest costs of the debt assumed via a future refinancing exercise.”
According to Mercom’s India Solar Project Tracker, SunEdison’s entire solar portfolio comprised of 1,620 MW (393 MW under operation). Out of SunEdison’s portfolio of solar projects in operation, 2.5 MW of rooftop projects have been acquired by Amplus, 177 MW were acquired by Terraform Global, and 214 MW were acquired by Greenko.
This is the second largest solar project pipeline acquisition in India this year following Tata Power Renewable Energy’s acquisition of Welspun Renewable Energy’s 1,140 MW renewable energy project pipeline for $1.4 billion (~Rs.92.5 billion).
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Raj is a recognized thought leader in clean energy markets where his work has influenced policies worldwide. He has a deep understanding of regulatory policy and clean energy markets and his market and opinion pieces are regularly published on both MercomIndia.com and other leading publications globally. Raj is also a regular speaker and presenter on clean energy policy and finance topics at conferences worldwide. Raj attended the KLE College of Science in Bangalore, India for physics and chemistry, and holds a Bachelor of Science Degree in Hotel and Institutional Management from Johnson and Wales University, Rhode Island. More articles from Raj Prabhu.