AIM-listed clean energy firm Greenko Group plc has completed acquisition of Hemavathy Power for an agreed enterprise valuation of $33mn. Greenko, which develops and owns renewable energy assets, will accquire Hemavathy in a leveraged buyout which includes debt and equity funding.
Hemavathy has a 24MW operational run of the river hydro project located in Karnataka. During FY10, revenues of the company stood at Rs 24.6 crore ($5.6 million) with an EBITDA of Rs17.7 crore ($3.8 million) and PAT of Rs 5 crore ($1.1 million). Hemavathy’s net assets as on 31 March 2010, including assumed loans of approximately Rs 50 crore were Rs 105 crore ($22 million).
Centrum Capital Ltd. was the sole financial advisor for Hemavathy on the deal.
Greenko owns various assets across hydro and biomass and its operating capacity will increase from 159MW to 183MW after this deal. Greenko has the target of reaching 1000MW of installed capacity by 2015. The firm also recently forayed into wind energy with plans to develop 200 MW of wind generating assets. It has started constructing 65 MW wind farm in the state of Maharashtra.
TPG Growth, an arm of global private equity major TPG, lead a $116-million round of funding in Greenko earlier this year. Greenko's other investors include Global Environment Fund and Aloe Environment Fund.
The clean energy IPP space is seeing increasing action from investors and companies regarding M&A. Small hydropower assets are increasingly coming on the radar of private equity investors.
Small Hydropower (SHP) accounts for 16.7% of total renewable capacity in India with a total installed capacity of 2430 MW as of March 2009. SHP installation has increased at a CAGR of 8.1% from 2002-03 to 2008-09.