Billionaire Gautam Adani-controlled Adani group said on Thursday it will acquire 10 operating solar energy assets of the beleaguered Essel group for an enterprise value of Rs 1,300 crore ($181 million).
According to a stock-exchange filing, Adani Green Energy Ltd will buy the solar assets owned by Essel Green Energy Pvt. Ltd and Essel Infraprojects Ltd. The total capacity of these assets is 205 MW. The solar plants are located in Punjab, Karnataka and Uttar Pradesh.
Jayant Parimal, CEO of Adani Green Energy, said the acquisition will increase the company’s total portfolio to about 5.5 GW. Of this, 2.5 GW is operational and the remaining will be operationalised over the next two years.
“This is our first brownfield acquisition of operating assets. It expands our footprint in states where we already have a presence,” Parimal said.
The all-cash transaction is likely to be completed by October 15, Adani Green Energy said.
The deal is part of a divestment process by media tycoon Subhash Chandra-controlled Essel group as it tries to lower its debt burden of more than Rs 16,000 crore.
Last month, the group sold an 11% stake in its flagship Zee Entertainment Enterprises Ltd to Invesco Oppenheimer Developing Markets Fund for Rs 4,224 crore. The media house needs to pay lenders Rs 7,500 crore by the end of September and so may look for another investor.
The group is also looking to sell its road assets and is said to be in talks with potential buyers including the government-backed National Investment and Infrastructure Fund, I Squared Capital-controlled Cube Highways and Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ). According to recent news reports, Essel is in talks with NIIF to sell its toll road assets for around $350 million.
The debt woes of the diversified Essel group, which has businesses across the media, education, infrastructure, real estate and energy sectors, rocked the mutual fund industry, putting pressure on its shares earlier this year.
Earlier this week, it was reported that of the Rs 6,300 crore that the group owed to mutual fund houses, it was supposed to pay Rs 2,600 crore by the end of the week. That would still leave Rs 3,700 crore yet to be repaid to mutual fund houses by September-end.
Among the asset management companies that have exposure to the Essel group, Birla Sun Life, HDFC, Franklin Templeton and ICICI Prudential have a combined exposure of Rs 5,500 crore. SBI Mutual Fund and Kotak Mutual Fund account for the remainder.