UK's AIM-listed Indian renewable energy firm Greenko has raised $125 million from Washington-based energy and infrastructure-focused asset management firm EIG Global Energy Partners, through its subsidiary Greenko Mauritius.
The funding, which was made public early this month, would be utilised to refinance debt worth $70 million from Standard Chartered, which is due in January 2015, and also to support the development of its renewable power projects in the development portfolio of 2.2 GW dominated by hydro and wind assets
“With over 1 GW capacity expected in 2015 supported by our continuous efforts to reduce the cost of debt with the recent bond issue and this investment, Greenko is well-placed for enhanced shareholder returns,” Anil Chalamalasetty, CEO and MD of Greenko, said in the statement.
The investment is a six-year instrument with a cash coupon of 5 per cent per annum and also carries a payment-in-kind coupon of 6 per cent payable at maturity with an option to convert this into Greenko Group shares.
With the investment, EIG has also become eligible for one board position at the Mauritius entity.
Investment banking and financial advisory firm Macquarie Capital acted as an adviser on the transaction.
R Blair Thomas, CEO of EIG Global Energy Partners, said: “India is a high growth energy market with improving macro-economic fundamentals and sustainable power is critical to India's continued success.”
EIG has invested over $16 billion spread over 34 countries in the energy sector. This is the first investment by EIG in the Indian energy sector.
Greenko is one of India’s largest independent power producers in the renewable energy space. It has a portfolio of wind, run-of-river hydropower, natural gas and biomass assets.
The company is now focused on building new utility scale wind farms and hydropower projects across India. Greenko's goal is to reach 1,000 MW of operational capacity in 2015 and approximately 2,000 MW in 2018.
Earlier in February, the company signed a deal with Lanco Infratech Ltd to buy out three hydro power assets of the latter with a combined capacity of 80 MW for an undisclosed amount.
Last year it raised $150 million from Singapore’s sovereign wealth fund GIC. This deal was through a Mauritius arm which gave GIC the option to convert it into shares of the parent firm listed in London.
Other investors in Greenko as a group include Aloe Private Equity, Standard Chartered Private Equity, GE Energy Financial Services and Capital Group.
(Edited by Joby Puthuparampil Johnson)