Sembcorp, Actis invest in renewable energy assets in India
12 Feb 2015
Singapore-based energy Sembcorp Industries and UK's Actis LLP are investing in renewable energy assets in India as the two look to tap into the government's programme to grow their renewable energy business and capabilities.
While Sembcorp is acquiring a majority stake in Hyderabad-based renewable energy company, Green Infra, Actis will invest in a greenfield project being set up by Ostro Energy in the country for generating clean energy.
Ostro is the fifth energy company Actis has established in developing countries since 2010, following units in Central America, Mexico, Chile and Brazil that focus on renewables.
Actis will invest $230 million in the new clean-energy unit in India to tap the country's potential for renewables.
Sembcorp on Wednesday said its wholly-owned subsidiary, Sembcorp Utilities, has signed agreements to acquire a 60-per cent stake in Green Infra, a renewable energy company in India with a wind and solar portfolio.
Semcorp said IDFC Alternatives, the private equity arm of IDFC, has entered into definitive agreements with the company to sell its controlling stake in Green Infra, valuing the latter at over Rs4,400 crore.
Following the transaction, IDFC Private Equity Fund II will completely exit Green Infra while IDFC PE Fund III will continue to hold a significant minority stake in the Green Infra with a secured path to exit, including through an IPO.
The acquisition marks Sembcorp's entry into India's attractive renewable energy market, and is a major step in the company's strategy to grow its renewable energy business.
Ostro Energy aims to install 800 megawatts of new capacity across several Indian states by 2019, Actis said in a statement.
The Delhi-based unit is already building its initial wind power plant, a 50.4-megawatt facility at Tejuva in Rajasthan. Most of its projects will be wind farms, it said.
"Actis sees significant potential in the Indian renewable sector." said Sanjiv Aggarwal, Actis's head of energy investments in Asia. "We believe that Ostro will become a leading wind provider in this market."
The government is planning to boost renewable energy as a way to reduce greenhouse gas pollution. It's considering clean-energy targets, expanding an existing programme to reach 100 GW of solar capacity by 2022.
