GE Energy Financial Services, the investment arm of American conglomerate General Electric, has agreed to invest $90 million (Rs 582 crore) to develop solar power projects in India with RattanIndia Group, a press statement said.
As part of the agreement, GE Energy Financial Services and RattanIndia will develop 500 megawatt solar assets in the states of Rajasthan, Karnataka, Uttar Pradesh and Maharashtra, the statement added.
GE Energy Financial Services will hold 49% in the assets while RattanIndia, formerly Indiabulls Power, will hold the rest.
Legal firm J Sagar Associates (JSA), led by partner Rupinder Malik, advised RattanIndia on the transaction.
The GE subsidiary had entered India's solar power market in 2014 with a $24-million investment in a 151-megawatt project built by Welspun Renewables Energy Pvt. Ltd in Madhya Pradesh.
It has also invested in wind projects of Atria Power and Greenko Group PLC.
GE Energy Financial Services has committed over $12 billion in global renewable energy investments, primarily in wind and solar, according to its website.
India’s renewable energy sector has seen a lot of activity over the last couple of years after the government set ambitious capacity-addition targets. The government aims to achieve 175 gigawatt of renewable power generation capacity by 2022. This includes 100 gigawatt of solar and 60 gigawatt of wind power capacity. India’s renewable energy capacity is currently around 44 gigawatt.
Renewable energy has been a preferred asset class for developers and investors because of falling solar panel prices and improving wind technology yields, according to Vikas Dawra, senior president & global head, investment banking, Yes Securities.
Some of the world’s biggest pension funds, including Canada Pension Plan Investment Board (CPPIB) and Caisse de dépôt et placement du Québec (CDPQ), are also scouting for deals in India’s solar power sector.
RattanIndia is a business conglomerate with interests in power-generation, cement and mining. It currently has an installed capacity of 1,620 megawatt, which is expected to rise to 2,700 megawatt by the end of financial year 2015-16, says its website.
The company was hived off from Indiabulls Group in July 2014. Rajiv Rattan, one of the three co-founders of Indiabulls, had left to lead RattanIndia.