ReNew eyes Orange’s portfolio in $ 950 million deal

ReNew eyes Orange’s portfolio in $ 950 million deal
19/07/2017 , by , in ALLIED

Sumant Sinha-led Re-New Power Ventures Pvt Ltd, a Goldman Sachs-backed clean energy company, is in active discussions with Orange Renewable to acquire its portfolio of about 600 MW of predominantly wind and a smattering of solar assets, according to multiple officials in the know. The enterprise value of the assets is pegged at Rs 6,175 crore ($950 million).

ReNew has already submitted a non-binding offer and is conducting due diligence, the sources said. Orange is promoted by Singapore’s AT Capital, an investment firm founded by Russia-based Indian origin billionaire Arvind Tiku who made his fortunes in the Central Asian oil and gas industry. Earlier this year, it mandated investment bank Rothschild to help scout a strategic buyer for the assets.

Negotiations are ongoing but the talks are not exclusive in nature. Sources said Orange has also reached out to a few other strategic players including the Adani group and Greenko, but the dialogue with ReNew is the most advanced.

The exact structure of the deal is not yet final, but chances of Orange merging into ReNew in a cash-and-stock deal is likely, said one of the officials involved directly, speaking on the condition of anonymity as the talks are in the private domain.

ReNew, valued at $2 billion, is one of India’s leading green energy companies with over 2,300 MW of operational wind and solar assets and another 1GW in the pipeline.

Other than the Goldman Sachs Group, the company is backed by a clutch of blue chip investors like Abu Dhabi Investment Authority, Asian Development Bank and the Global Environment Fund. This February, Japan’s JERA Co — a joint venture between Tokyo Electric Power Co and Chubu Electric Power Co — bought into the company with a 10% stake for $200 million.

Most analysts see ReNew’s move as an attempt to bulk up its portfolio further ahead of a proposed $400-700 million IPO. Mails sent  to Tiku; Deepak Mawandia, the chief investment officer and director at AT Capital; and Sudhir Nunes, CEO of Orange Renewable, did not generate any response. Sinha, ReNew’s chairman and spokesperson, also did not respond to an email until press time

Orange founder Tiku has interests in oil and gas, property and renewable energy, held through his private holding outfit, AT Holdings.

He left India at the age 18 to study engineering in Russia and worked as a commodities trader before branching out on his own in oil and gas in Kazakhstan.

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