TPG & StanChart PE-backed Greenko buys 3 hydro projects worth 15 MW
Greenko Group plc, one of India’s largest independent power producers in renewable energy space, has acquired three hydropower projects in Himachal Pradesh (totalling 15 MW) for an undisclosed amount. The AIM-listed firm, backed by TPG Capital and Standard Chartered Private Equity, has said that the total value of these projects (including project finance debt) is $24 million or Rs 132 crore.
The deal brings Greenko’s total power-generating portfolio to over 275 MW. The firm is targeting 1,000 MW in operational assets by 2015.
The current transaction follows Greenko’s acquisition of a 32 MW cluster of operating hydro projects in Himachal Pradesh in April this year. During that transaction, Greenko committed to acquire more projects for another 15 MW, subject to certain conditions (which have now been fulfilled).
Greenko acquired the 32 MW Himachal Pradesh cluster, along with 24 MW ‘under development’ project in Karnataka, for a total of $54 million.
In the 15 MW projects acquired in the current deal, the power produced is sold under long-term power purchase agreements (PPA) to the local state electricity board. The average plant load factor (PLF) for the combined asset is expected to be in excess of 60 per cent and the average PPA price is Rs 2.95/kWh.
“While Greenko anticipates growing its hydro portfolio primarily through organic development, it will continue to evaluate acquisition opportunities on a case-by-case basis,” said a company statement, adding that it would look at projects under construction or at an advanced developmental stage.
“Greenko has generated strong returns from its hydro assets. These are some of the most attractive and sustainable assets for an Indian energy market that is characterised by high demand and constrained base load fuel supply,” said Anil Chalamalasetty, CEO and MD of Greenko.
Greenko has 151 MW operational small hydro assets in India, a further 189 MW currently under construction and 182 MW under active development.
The company reported a fall in revenues in FY12 to $47.1 million from $56.7 million in the previous fiscal, mainly due to falling value of rupee. While EBITDA improved 9 per cent, profit after tax remained stable at $14.6 million.
Greenko Group’s Mauritius Unit had raised $70 million from Standard Chartered Plc in a structured deal in December 2011. Earlier, it had also raised $50 million from GE Energy Financial Services for its wind energy business.
Other shareholders in Greenko include early-backer Aloe Environment Fund (11.2 per cent), TPG Growth (8.1 per cent), Impax Asset Management (5.2 per cent) and Capital Group (7.3 per cent).
(Edited by Sanghamitra Mandal)
Greenko Group Plc is an energy industry and a market leading owner and operator of clean energy projects in India. It generates and sells electricity through wind, hydro-power, natural gas, and biomass sources. The firm sells electricity to state utilities, and other electricity transmission and trading companies. The company was founded in 2006 and is based in Hyderabad, Telangana.
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TPG Capital Inc. (formerly Texas Pacific Group) is a private equity firm with $75 billion assets under management. It provides finance to seed, early, growth stage and buyout transactions. The firm seeks to invest in real estate, pharma, energy, health care, apparel, retail and financial service sectors. The company was founded in 1992 and is based in Mumbai, Maharashtra with additional offices at China, Australia, Russia, Singapore United Kingdom, Japan and United States.
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Standard Chartered Private Equity Fund is a private equity fund managed by Standard Chartered Private Equity Advisory India Pvt. Ltd. It provides growth, management buyouts and mezzanine capital to companies operating in Greater China, African, India, Korea and South East Asia. The firm seeks to invest in media, food and beverages, manufacturing, infrastructure, energy, information technology, hotels and resorts, construction, technology, financial and Pharmaceutical sectors. It seeks to invest typically between $10 million and $100 million in its portfolio companies.
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