Engie To Give Up Majority Stake In Indian Solar Assets

Engie To Reduce Net Debt By €400 Million With EIYP & Sekura Energy Buying 74% Stake In 813 MW Operational Solar Power Capacity Of French Company In India
04:51 AM (Beijing Time) - 24. January 2020

Key Takeaways

  • Edelweiss Group’s EIYP and its portfolio company Sekura Energy will purchase 74% stake in Engie’s Indian solar assets
  • The French company is giving up this majority stake in 12 operational solar assets with 813 MW capacity
  • Engie says it will help the company free up its resources and reduce net debt by more than €400 million
  • Both Engie and EIYP will continue to grow the solar platform under a strategic partnership

French energy company Engie is giving up a 74% stake in its 12 solar assets in India representing 813 MW of operating capacity to Edelweiss Infrastructure Yield Plus (EIYP) and a portfolio company of the latter called Sekura Energy Limited. EIYP is an infrastructure focused fund managed by Edelweiss Group’s Edelweiss Alternative Asset Advisors Limited.

The divestment, explained Engie, will help the company reduce its net debt by more than €400 million ($443.7 million) and is part of the company’s business model to develop-build-share-operate (DBSO) under which it partially sells off interest in its EPC projects post commissioning.

Engie said it will collaborate further with EIYP under an ‘ambitious strategic partnership’ to expand a growing solar platform with the French company continuing to look after development, construction and operation of present and future solar plants.

“EIYP will benefit from access to a strong future pipeline of quality solar assets to be developed and constructed by Engie under the terms of the agreement,” stated EIYP Head, Subahoo Chordia. “This will also grow EIYP’s Sekura Energy platform and make us a large investor in Indian energy space.” 

The sale for 813 MW is expected to be realize during H1/2020. Currently, Engie’s renewable energy capacity in the country exceeds 1.5 GW comprising wind and solar power plants with solar projects concentrated in the states of Punjab, Rajasthan, Uttar Pradesh, Telangana, Andhra Pradesh and Gujarat. 

Engie’s solar asset sale was being planned for long as Indian business daily Mint reported back in July 2018 that the French energy company was looking for an external buyer; it had hired financial advisor Rothschild to find a potential partner (see Engie To Sell Stake In Indian Solar Business). 

In a recent news article, Mint reported that Engie’s 813 MW Indian solar portfolio came from its subsidiary Solairedirect. It also pointed out that Engie’s decision to sell its stake at a time of Andhra Pradesh government’s decision to revise its renewable energy contracts though Engie makes no mention to this in its official statement.

Anu Bhambhani

Anu Bhambhani is the Senior News Editor of TaiyangNews

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Anu Bhambhani