Monday, 13 June 2016

Tata Power, Welspun seal ‘largest’ renewable energy deal in India: 5 things to know

Tata Power on Sunday informed BSE that its wholly owned subsidiary, Tata Power Renewable Energy Ltd (TPREL), will acquire Welspun Energy’s subsidiary, Welspun Renewable Energy Pvt Ltd (WREPL). JM Financial Institutional Securities Limited acted as exclusive transaction advisor to TPREL in relation to this transaction. KPMG India Private Limited was the accounting and tax advisor. AZB and Partners acted as
the legal advisor for this transaction.
Below are the 5 things to know about the deal
1. Welspun Enterprises on Sunday informed bourses that Welspun Energy, in which Welspun Enterprises holds 15.49 per cent stake, has signed a special purchase agreement (SPA) with Tata Power Renewable Energy Ltd for divestment of its subsidiary of its Welspun Renewable Energy Private Ltd. The deal represents the largest transaction in renewables space in India.
2. WREPL has one of the largest operating solar portfolios in India spread across ten states. The press release added it has about 1,140 mega watt (MW) of renewable power projects comprising about 990 MW solar power projects and about 150 MW of wind power projects. Out of 1,140 MW renewable portfolio, nearly 1,000 MW of capacity is operational and balance capacity is under advanced stages of implementation.
3. TPREL currently operates 294 MW of renewable power capacity and 500 MW of renewable assets are being carved out of Tata Power into TPREL through a court process. In addition, almost 400 MW of solar and wind power projects are under implementation. Thus, TPREL with all these assets, would have renewable assets portfolio of about 2,300 MW making it the largest renewable power company in India, Tata Power has claimed.
4. The transaction is subject to various statutory and other regulatory approvals. The Enetrprise Value of the transaction excluding closing adjustments is Rs 9,249 crores, subject to closing adjustments.
5. Welspun Enterprises shares jumped as much as 10.58 per cent in the early trade on Monday. Tata Power shares which surged over 2.5 per cent in the early trade were trading 0.07 per cent down at 75.95 (at 9.52 am).

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