Companies
The Netherlands’ SHV Energy appoints BNP Paribas to sell SunSource’ solar assets in $100 million deal
Summary
- Dutch firm SHV Energy has hired BNP Paribas to divest SunSource Energy's solar assets. The deal, in early stages, involves 290 MW of operational assets and a plan for acquiring 300 MW of additional capacity, reflecting rising investor interest in India's green energy.
New Delhi: Dutch multinational SHV Energy has appointed BNP Paribas to sell the solar energy assets of its subsidiary SunSource Energy in a deal having an equity value of around $100 million, said two people aware of the development.
The transaction which is in initial stages, involves the sale of 290 MW of operational assets of SunSource Energy in the commercial and industrial segment, and a framework to fully acquire the funded pipeline of 300 MW upon commissioning.
“The transaction involves a mix of secondary sale and primary infusion," said one of the two people, requesting anonymity.
SHV Energy, which has a presence in liquified petroleum gas (LPG), liquified natural gas (LNG), and green energy, acquired a majority stake in SunSource Energy in May 2021. SunSource Energy was founded by Adarsh Das and Kushagra Nandan in 2010.
Spokespersons of SHV Energy, SunSource Energy and BNP Paribas did not reply to queries emailed on 22 October.
Also read | Why solar and wind energy are not market winners yet
India’s green trajectory
The proposed deal comes amid strong investor interest in India’s commercial and industrial segment, as reported by Mint.
Thailand’s energy firm Banpu Public Co. Ltd, former US vice-president Al Gore-headed Generation Investment Management’s Just Climate LLP, and Singapore’s CapitaLand Investment Ltd have been shortlisted to acquire Eversource Capital-backed Radiance Renewables Pvt. Ltd, in a deal having an enterprise value of around $325 million.
This investor interest also comes as India’s green energy trajectory is on an upswing. India is undertaking the largest renewable energy programme globally, which has led to an investment of Rs8.5 trillion in the country’s renewable energy sector between 2014 and 2023.
The regulatory landscape is also supportive of the commercial and industrial segment, with rules allowing large power users to source energy from the open market rather than from the costlier grid.
Commercial and industrial projects are also shielded from risks such as power procurement curtailment by state-run power distribution firms. Also, the implementation of a time-of-day tariff for large commercial and industrial consumers by state electricity regulatory commissions has helped sustain investor interest.
Also read | India's renewable energy boom stunted by regulatory ambiguity over sales accords
India has an installed renewable energy capacity of 210 GW, including 90.76 GW of solar and 47.36 GW of wind power capacity.
Rajasthan, Gujarat, Tamil Nadu, and Karnataka have taken the lead in setting up green energy projects, with installed capacities of 29.98 GW, 29.52 GW, 23.70 GW, and 22.37 GW, respectively.
In addition, the Union government is focusing on promoting solar cell and module manufacturing. India currently has a cell manufacturing capacity of around 10 GW and a module manufacturing capacity of 60 GW.
Also read | India's green energy push spawns a unique resale market
