2024-09-25 06:30:12 :
NEW DELHI: Thai energy company Banpu Public Co. Ltd has joined the race to acquire Eversource Capital-backed Radiance Renewables Pvt. The deal has an enterprise value of about $325 million, two people familiar with the matter said.
The Bangkok-based company has been shortlisted to make a binding offer for the sale of 100% of Radiance; this brings it together with Just Climate LLP, the generation investment management company led by former US Vice President Al Gore, and CapitaLand Investments of Singapore Ltd (CapitaLand Investment Ltd), which was also shortlisted for the second round after submitting a non-binding offer (NBO) in the sale. The process is run by Rothschild & Co.
for the second round
“Banpu, Just Climate and CapitaLand have been shortlisted for the second round,” said the two people, who requested anonymity.
Mint It follows reports that Just Climate LLP and CapitaLand Investment Ltd are exploring an acquisition of Eversource Capital-backed Radiance Renewables, which operates in the commercial and industrial (C&I) sector.
Radiance has operating capacity of 350 MW of commercial and industrial projects and is also backed by India’s quasi-sovereign wealth fund National Investment and Infrastructure Fund (NIIF) and the UK government’s Foreign, Commonwealth and Development Office (FCDO). UK International Investments Limited is owned by FCDO.
Spokespeople for Rothschild & Co. and Just Climate declined to comment.
“We regret not commenting on market rumors or speculation,” a spokesperson for CapitaLand Investments said in an emailed response.
A spokesman for BII said in an emailed response: “It is company policy not to comment on market speculation.”
“I have no comment,” Radiance Renewables executive director and CEO Manikkan Sangameswaran said in an email response.
Inquiries emailed Monday evening to spokespersons for Eversource Capital, Banpu Public Company and NIIF remained unanswered by press time.
Industrial and commercial interest rates rise
The proposed deal reportedly comes amid strong investor interest in India’s industrial and commercial sector, with multiple deals currently underway Mint. The regulatory environment supports the sector, with rules allowing large power users to source their energy from the open market rather than from the expensive grid. Industrial and commercial projects are also protected from risks such as purchase restrictions imposed by state-owned distribution companies. In addition, the implementation of time-of-use tariffs (ToD) by the State Electricity Regulatory Commission (SERC) for large industrial and commercial consumers has helped maintain investor interest.
Analysts believe that commercial, industrial and rooftop sectors will be supported by the government push.
“Significant growth is expected in the commercial, industrial and rooftop solar sectors, which together account for approximately 30% of current solar generation capacity. Approximately 4 GW per year is expected to be added over the next few years. Growth in the C&I sector will be driven by the formation of group captive arrangements companies to benefit from tariff reductions that enable them to obtain reliable, cost-effective (compared to the C&I rates of most state DISCOMs) and environmentally friendly electricity (e.g. they receive renewable energy credits, compared to grid-supplied electricity different),” SBI Capital Markets Ltd said in a report in August.
India’s installed renewable energy capacity is 180.79 GW, of which solar installed capacity is 73.31 GW and wind power installed capacity is 44.73 GW.
“In addition, the Prime Minister Surya Ghar Muft Bijlee Yojana (PM-SGMBY) has pledged to provide up to 300 units of electricity per household per month to support this growth,” the report added.
Banpu Public Co., which has a market capitalization of $12.34 billion, has energy, power generation and technology businesses in Thailand, Indonesia, Vietnam, Lao People’s Democratic Republic, Mongolia, China, Japan, Australia and the United States.
Set up for double funding
CapitaLand announced earlier this month that it aims to more than double its funds under management (FUM) in India by 2028 from S$7.4 billion. Earlier this month, CapitaLand CEO Lee Chee Koon met Singaporean Prime Minister Narendra Modi during Modi’s visit. CapitaLand has S$134 billion in assets under management and S$100 billion in funds under management. The company had previously considered acquiring a controlling stake in rooftop solar generator CleanMax Enviro Energy Solutions Pvt. Ltd., which was acquired by Brookfield Renewable Energy last year for $360 million.
“CLI will explore opportunities to enter adjacent business areas such as renewable energy and real estate private credit. Renewable energy is a fast-growing sector in India and the government aims to increase the current 111 gigawatts (GW) to 500 gigawatt (GW). CLI’s data center and business park tenants have stringent requirements for renewable energy,” CapitaLand said in a statement on September 4.
London-based Generation Investment Management LLP is one of the world’s largest sustainable investment firms, with $44 billion in assets under management and oversight. NIIF is sponsored and supported by the Government of India, which holds a 49% stake. It mainly focuses on investing in core infrastructure areas such as transportation, energy and digital. It manages more than $5 billion in equity capital commitments across three funds (Master Fund, Fund of Funds and Strategic Opportunities Fund).
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