JSW Neo Energy to acquire O2 Power with enterprise value of US$1.47 billion

New Delhi: JSW Neo Energy, a wholly-owned subsidiary of JSW Energy Ltd, will acquire renewable energy platform O2 Power for an enterprise value of $1.47 billion.

European alternative asset management company EQT and Singapore’s Temasek hold 51% and 49% of O2 Power respectively, which has a renewable energy production capacity of 4.7 GW. Once the deal is completed, both of them will exit the company founded by former ReNew Power executives Parag Sharma, Peeyush Mohit and Rakesh Garg.

JSW Energy said in a statement that the transaction involves the acquisition of O2 Power Midco Holdings Pte. Ltd. and O2 Energy SG Pte. Ltd. and is subject to Competition Commission of India (CCI) approval and other customary transactions of this size. Approval standards.

September, Mint According to reports, JSW is one of the shortlisted bidders to acquire O2 Power. Other bidders in the race include New York-based alternative investment firm Stonepeak, I Squared Capital and Macquarie Group.

O2 Power has a total capacity of 4,696 MW, of which 2,259 MW will be operational by June 2025. Another 1,463 MW are currently under construction and approximately 974 MW are in preparation and are scheduled to be commissioned in June 2027. The capacities are said to be spread across seven Indian states.

The acquisition will help increase JSW Neo Energy’s locked or planned generation capacity by 23% to 24,708 MW from the current 20,012 MW.

Sharad Mahendra, Joint Managing Director and CEO of JSW Energy, said: “We are delighted to announce the acquisition of O2 Power’s 4.7 GW renewable energy platform, which is JSW Energy’s largest acquisition since its inception. This landmark acquisition Strengthening our position as a leading player in India’s energy sector, these high-quality assets strengthen our operational footprint in key resource-rich states. I am very pleased to welcome O2 Power’s experienced management team and employees to the JSW Energy family.”

Pritesh Vinay, Director (Finance) and Chief Financial Officer of JSW Energy noted that the acquisition will bring significant value accretion to JSW Energy’s shareholders.

“Compared to all recent acquisitions in this space, both from a ‘build or buy’ trade-off, but also from a quality and value perspective, this is a very attractive acquisition and is consistent with our acquisition-wise Consistent with a long-term record of prudent capital allocation and focus on high cash return projects above our mid-range equity IRR (internal rate of return) threshold level.”

PwC was JSW Neo’s transaction advisor, and Khaitan & Co and Herbert Smith were legal advisors. KPMG conducted financial and tax due diligence and Wind Guard conducted technical due diligence, the statement said.

Earlier this month, JSW Energy said in a regulatory filing that it had secured multiple renewable energy projects in the commercial and industrial (C&I) power market, locking in a total generation capacity of 20 GW.

JSW Energy started commercial operations in 2000 with the commissioning of its first 2×130 MW thermal power plant in Vijayanagar, Karnataka. Since then, the company has increased its power generation capacity from 260 MW to 7,740 MW, including 3,508 MW of thermal power, 2,166 MW of wind power, 1,391 MW of hydropower and 675 MW of solar power. Various power generation projects are currently under construction with a capacity of 2.1 GW, and the goal is to have a total power generation capacity of 20 GW put into operation by 2030.