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CESC Unit to Buy 1.4 GW Solar Assets From ReNew For INR48.6 Billion

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CESC Unit to Buy 1.4 GW Solar Assets From ReNew For INR48.6 Billion

Indian electric power distributor CESC (NSE:CESC, BOM:500084), through its renewable energy unit Purvah Green Power, has signed a share purchase agreement to acquire 100% of six ReNew Solar Power subsidiaries holding 1.41 gigawatts of installed capacity at an enterprise value of 48.6 billion Indian rupees.

The enterprise value excludes a contingent payment of an estimated 2.3 billion rupees, payable only if there is additional realization from a change-in-law claim, according to a filing with the National Stock Exchange of India on Monday.

Cash consideration payable at closing is 15.8 billion rupees, comprising 5.89 billion rupees for share capital and a 9.93 billion-rupee infusion of unsecured promoter debt used to repay existing promoter debt at the target companies.

The six target companies - ReNew Hans Urja, ReNew Solar Photovoltaic, ReNew Wind Energy (Karnataka 3), ReNew Wind Energy (MP Four), ReNew Wind Energy (Karnataka 4) and ReNew Agni Power - are held across project special purpose vehicles in Rajasthan and Karnataka.

More than 90% of the acquired capacity is contracted with state-run Solar Energy Corp. of India under 25-year power purchase agreements, with the balance tied to Karnataka distribution companies, CESC said.

No governmental or regulatory approval is required for the transaction, which is funded by the parent company and expected to close before Oct. 31.

Upon completion, the six companies will become step-down subsidiaries of CESC.

The deal lifts Purvah's total contracted renewable capacity to 4.8 gigawatt-peak from about 3.4 GWp, as the company aims to reach 10 GW of renewable energy.

Purvah was established in December 2023 and develops and operates utility-scale solar, wind and hybrid renewable energy assets across India.

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