Aditya Birla Group has hired Standard Chartered to sell up to 49% of its renewable energy business in order to raise $400 million, according to two people familiar with the matter, as the conglomerate seeks to strengthen its position in India's rapidly growing clean energy sector.
Aditya Birla Renewables aims to install 4.5GW of renewable energy capacity through utility and commercial and industrial (C&I) projects by FY2026, expanding on its current project portfolio of 2GW, which includes existing and upcoming projects. With strong investor interest in the mature C&I segment, it provides protection against risks such as discoms curtailing power procurement. Open access enables large power users to purchase power on the open market rather than from the more expensive grid.
Aditya Birla Group and Abraaj Group agreed to collaborate in October 2015 to build a large-scale renewable energy platform in India. However, due to the demise of the Abraaj Group, the plan was shelved.
Standard Chartered's spokesperson declined to comment. Questions sent to the Aditya Birla Group's spokesperson on February 13 went unanswered.
“The renewable energy business is a potential growth engine for the Aditya Birla Group, and the plan is to grow it considerably," said one of the two people cited above requesting anonymity. India’s green economy remains an attractive investment for global investors, despite the prevailing global economic headwinds. Amazon.com Inc. is one of the latest entrant in this space, procuring renewable energy to build a portfolio for sale on Indian electricity exchanges. With the world’s fourth-largest installed renewable energy capacity at 166GW, India has attracted $78.1 billion in investments for its renewable sector. Central Electricity Authority, India’s top power sector planning body, expects over half of the country’s 817GW power requirement by 2030 to be met through clean energy sources.
According to sources, several green energy deals are in the works, including India's largest pure-play solar platform, the ACME Group, giving Rothschild and Co. a formal mandate to raise $500 million equity by selling a stake in ACME Cleantech Solutions Pvt. Ltd. Torrent Power Ltd, based in Ahmedabad, is also in talks with ReNew Energy Global Plc to purchase 1.1GW of its operational, clean energy capacity for approximately $1.2 billion. Alberta Investment Management Corp., Ontario Municipal Employees Retirement System (OMERS), Brookfield Asset Management Inc., and I Squared Capital are among the Canadian firms interested in investing in Hyderabad-based renewable energy company Fourth Partner Energy Pvt. Ltd. Furthermore, Petronas, Sembcorp Industries, JSW Neo Energy, BP Plc, and Statkraft, Norway's state-owned electricity company, and I Squared Capital is looking to acquire Continuum Green Energy (India) Pvt. Ltd at an enterprise value of $1.5 billion.