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IFC May Lend $26M To Mahindra-Kiran Energy Venture

International Finance Corporation (IFC) may provide $26 million in senior debt to three new solar projects being developed by Mahindra Solar One, a 26:74 joint venture between the Mahindra Group and Kiran Energy, a privately held power firm backed by private equity firms.

The JV company is looking to develop 50 MW of capacity in Rajasthan at a total cost of $105 million. Mahindra Solar One, through its wholly-owned subsidiary Mahindra Suryaprakash Ltd, is developing a 20 MW and a separate 10 MW solar photovoltaic plant. Another 20 MW solar PV plant is being developed at the same area by Solarfield Energy Two Private Ltd, wholly-owned subsidiary of Kiran Energy Ltd.

The three projects are using similar technology, and have been awarded similar tariffs and will enter into identical power purchase agreements. 

IFC, the private investment arm of The World Bank, will give $15.9 million loan to Mahindra Suryaprakash, and the balance $10.1 million to Solarfield Two. The loan will have a tenor of 15 years.

Kiran Energy is a Mumbai-based solar power company founded by Ardeshir Contractor (former head of KPMG’s investment banking business in India) and Alan Rosling (a former executive director of Tata Sons).

Other promoters include IIT Mumbai faculty members Dr Sunit Tyagi and Dr Hemanshu Bhatt, who have expertise in the solar sector. Kiran Energy is backed by private equity players New Silk Route, Bessemer Venture Partners and Argonaut Private Equity.

Earlier, IFC had also provided debt for a 5 MW plant by Mahindra Solar One, which has been commissioned and is generating revenues.

IFC has been fairly aggressive investor in renewable energy assets in India. The firm is also looking to invest $9 million in waste to energy project developer RenewGen Enviro Ventures India and $130 million in INOX Renewables Ltd, a part of the $2 billion INOX Group.

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