AIM-listed developer, owner and operator of clean energy projects in India Greenko is acquiring Hemavathi Power & Light Pvt Ltd for €26 million, including net debt/liabilities assumed as part of the acquisition.
Greenko has entered into a conditional share purchase agreement to acquire Hemavathi that operates a 24MW run-of-river hydro asset on the Hemavathi River in the state of Karnataka. The firm is expected to complete the transaction in the next few weeks.
Out of the total deal value €18.4 million will be through new debt finance from L&T Finance and the balance will be through a mix of cash and could include shares of Greenko.
The acquisition will increase the secured power generation capacity of Greenko from 587MW to 611MW and its operating capacity from 159MW to 183MW.
The assets that depend on rainfall to power the flow of water to generate energy, should contribute an annualised EBITDA of €4.0 million, believe Greenko directors provided the country receives normal monsoon.
For the year ended March’09, Hemavathi had EBITDA of approximately Rs 19 crore (€3.15 million), compared to Rs 25.6 crore (€4.26 million) in the previous year. Its net assets as of 31 March 2009, including assumed loans of approximately Rs 62.5 crore, were Rs 100 crore (€16.7 million).
Greenko has the target of reaching 1000MW of installed capacity by 2015.
Early this year Greenko had secured rights to develop 117 MW of natural gas energy generation in the southern state of Andhra Pradesh through the purchase of LVS Power Limited. The total capital required for the acquisition and the capex required for the 85MW additional capacity(besides 36.8MW existing capacity) was pegged at € 80 million. Greenko said it plans to finance three fourth of this through debt with the balance through cash. For the year ended 31 March 2010, LVS Power produced EBTIDA of € 5.9million (after non-recurring income of € 1.4 million).