Japan’s JERA to pick up 10% in ReNew Power for around $200 mn

Japanese energy company JERA Co Inc will acquire a 10 per cent equity stake in Indian renewable power company ReNew Power Ventures Private Limited, marking the entry of Japanese investors into India's clean energy market.

With this latest round of investment, ReNew is now valued at $2 billion and the deal size is estimated to be around $200 million.

The acquisition will be made through subscription to newly issued shares of ReNew by a wholly-owned subsidiary of JERA, the Japanese company stated in a release.

ReNew is a major renewable power generation company based in India which develops and operates wind and solar power generation across the country. ReNew already operates 1.5 GW of power generating assets and has 1.8 GW of assets under construction. Since its establishment in 2011, ReNew has expanded its business significantly, with further growth expected in the future.

In India, significant economic growth has brought increased demand for electricity. In addition, the Indian government has set a target of introducing 100 GW of solar and 60 GW of wind power generation by 2022. ReNew will play an important role in achieving these targets.

With the acquisition of a stake in ReNew Power, JERA will make available technical, operational, project development, and management expertise gained in the global power business to the Indian partner.

JERA is a joint-venture between two of Japan's largest utilities companies, Tokyo Electric Power Co Inc and Chubu Electric Power Co Inc. JERA, currently, operates approximately 6 GW of energy assets globally across North America, the West Asia and South East Asia.

''JERA looks forward to strengthening its relationship with ReNew and our co-shareholders in ReNew, and to making a positive contribution to India's economic growth and environmental sustainability through ReNew's success in developing its renewable energy capacity.

''This is JERA's first major transaction in the renewable energy space, and signifies the importance to JERA of developing a balanced overseas power generation portfolio that includes renewable energy. Adding to its renewable energy portfolio is an integral part of JERA's plans to secure sustainable growth,'' it added.

ReNew Power is the first company in India to cross 1 GW of commissioned wind energy capacity. ReNew also emerged as the largest winner in the auctions conducted by the Solar Energy Corporation of India, winning almost 10 per cent of the total capacity of 500 MW for rooftop projects. Further, the company has won the mandate to install 5 MW of renewable energy capacity pan-India for the Indian Railways.

Sumant Sinha, chairman and CEO of ReNew Power, said, "We are delighted that JERA has chosen to enter the Indian renewable energy sector by investing in our ever-expanding and fast-growing company. ReNew Power will continue to focus on developing sustainable and innovative solar and wind energy solutions and investing in high-quality projects to create positive returns for our stakeholders."

ReNew Power Ventures Pvt Ltd, an independent power producer, has over 3,000 Mw of commissioned and under-construction wind and solar capacity across the states of Delhi, Gujarat, Haryana, Punjab, Madhya Pradesh, Rajasthan, Maharashtra, Karnataka, Telangana, Jharkhand, Uttar Pradesh, West Bengal, Tamil Nadu, Himachal Pradesh and Andhra Pradesh.

ReNew Power was launched in 2011 with Goldman Sachs. It recently secured long-term debt financing of $390 million from the Asian Development Bank and LEAP. The company said its founder Sumant Sinha remains the majority stakeholder.