ReNew Power Acquires Ostro Energy

India's ReNew Power Ventures Acquires Green Energy Assets Of Ostro Energy For Undisclosed Sum; Local Media Pegs Deal At 108 Billion INR ($1.66 Billion) 
06:30 AM (Beijing Time) - 04. April 2018
Renew

The acquisition of Ostro Energy is the largest acquisition for ReNew Power Ventures till date. Recently the company revealed its new logo that, it says, signifies its evolution in seven short years into one of the country’s largest companies in the renewable energy sector (Source: ReNew Power Ventures)

Key Takeaways

  • After ReNew Power Ventures has acquired Ostro Energy Private Limited it owns a total RE capacity of 5.6 GW
  • Acquisition gives ReNew rights over 1.1 GW of Ostro Energy's green energy capacity of which 850 MW is operational, including 110 MW of solar PV capacity
  • This deal makes ReNew the largest renewable energy project developer in India
  • ReNew has not revealed the takeover price, but local media says it cost 108 billion INR ($1.66 billion)
  • ReNew will be helped in this acquisition by Canada Pension Plan Investment Board (CPPIB) that will be investing $247 million into ReNew

Indian renewable energy player ReNew Power Ventures has acquired fellow Indian green power project developer Ostro Energy Private Limited. With this acquisition, ReNew Power now owns over 5.6 GW of renewable energy capacity. Out of this, over 65% or 3.65 GW is already operational.

 Already with green energy assets of over 4.5 GW including 2.8 GW of commissioned capacity, ReNew has now acquired 1.1 GW capacity from Ostro. Ostro Energy has been primarily into wind power project development. Its operational solar power capacity is 110 MW out of the 850 MW commissioned capacity.

Mercom India Research says this deal makes ReNew the largest renewable energy project developer in India across the wind and solar energy sectors combined.

Ostro’s solar power capacity includes a 50 MW PV project in Telangana that it developed in a JV with the Suzlon Group (see Wind Companies Bet Big On Solar In India). The remaining share of the 110 MW PV capacity is operational in the state of Rajasthan in the form of three projects of 20 MW each at three sites. It used domestic modules manufactured by Vikram Solar for this 60 MW capacity.

Ostro’s assets are spread across Andhra Pradesh, Telangana, Karnataka, Rajasthan, Madhya Pradesh and Gujarat. The portfolio is diversified by off-takers and OEMs, further complementing the ReNew Power portfolio, stated ReNew.

ReNew Power has not shared how much the transaction cost, but a report in the local business daily The Economic Times (ET) put the figure at 108 billion INR ($1.66 billion). Out of this, ReNew will pay around 45 billion INR ($692 million) as equity,  63 billion INR ($969 million) will a debt component. The acquisition follows another big renewables take over that made headlines in June 2016. Back then, Tata Power acquired renewable energy arm of Welspun Energy and had become the largest renewable energy company in the country with 2.3 GW of total assets (see Tata Acquires Welspun Renewables).

CPPIB invests in ReNew, again

Canada Pension Plan Investment Board (CPPIB) will be investing an additional $247 million to help ReNew Power in the acquisition of Ostro. This is CPPIB’s second investment in ReNew Power. Back in January 2018, it had invested $144 million in the Indian company. Through the last investment, CPPIB acquired a 6.3% stake in ReNew from Asian Development Bank (ADB) (see ReNew Power To Invest Heavily In Solar).

Anu Bhambhani

Anu Bhambhani is the Senior News Editor of TaiyangNews

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Anu Bhambhani