Mitsui to acquire 49% stake in Mahindra solar unit

Japanese conglomerate Mitsui & Co. Ltd is acquiring a 49% stake in Marvel Solren Pvt. Ltd, a unit of the Mahindra Group’s clean-technology arm Mahindra Susten Pvt. Ltd.

Mahindra Susten will continue to hold a controlling stake (51%) in Marvel after the transaction is completed, Mahindra & Mahindra Ltd said in a stock-exchange filing on Monday. 

The financial specifics of the deal were not disclosed.

Marvel currently operates four solar power projects in the country with a combined capacity of 16 megawatts. The company helps its clients reduce their carbon footprint through long-term purchase agreements that run between 10 to 25 years.

The move is part of the two companies’ goal to jointly develop and operate distributed solar power generation projects in India, the statement added. 

Mahindra Susten chief executive officer Basant Jain said that the collaboration between the two groups would help in targeting India's industrial and commercial sectors.

Separately, Mistui’s Infrastructure Projects Business chief operating officer Kazumasa Nakai said the move would also help turn India into a low-carbon society. 

“Utilizing Mitsui’s global network, together we aim to expand the business to 150 mega-watts by 2023,” he said.

Mahindra Susten – a portfolio company of Mahindra Partners, the private equity division of the Mahindra Group – provides services within the renewable energy segment such as site surveys and feasibility reports to unit maintenance. The company also provides advisory services pertaining to aspects such as financing, financial benefits and regulatory approvals.

Tokyo-headquartered Mitsui & Co. is a global trading and investment company which has a presence in over 60 countries. Its portfolio is focussed on sectors such as energy and resources, machinery and infrastructure and chemicals.

Recent deals in the segment

Mitsui’s collaboration with Mahindra is the latest move by companies seeking to grab a slice of the growing renewable energy pie, with many deals focussed on the solar power segment. A report published last month by accountancy firm Ernst & Young found India to be the fourth-most attractive market for investment in the sector.

In May, Piramal Enterprises Ltd and Canada Pension Plan Investment Board (CPPIB) signed an initial pact to co-sponsor a renewable energy-focussed Infrastructure Investment Trust (InvIT). The InvIT will have an initial corpus of $600 million (around Rs 4,160 crore) with an option to increase it further.

During the same month, Noida-based startup Skilancer Solar Pvt. Ltd. raised money from Alfa Ventures, a proprietary fund launched by angel investor Dhianu Das to make seed investments in startups.

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