Indian power-sector infrastructure trust (InvIT) India Grid Trust (BOM:540565), or IndiGrid, has recently inked an INR-40-billion (USD 483m/EUR 447m) deal to buy Virescent Renewable Energy Trust (VRET), a KKR-backed local renewable energy platform with 538 MWp of solar assets.
Set up by the US private equity firm in 2020, VRET is described as India’s first and only renewable energy InvIT. Its portfolio comprises 16 operational solar plants across seven states, the largest of which is a 130-MW/169-MWp asset located in the state of Maharashtra.
The purchase will increase IndiGrid’s assets under management (AUM) to INR 269 billion and its overall solar assets portfolio to 674 MWp. The transaction is also expected to add INR 2 billion annually to the company’s net distributable cash flow (NDCF).
“Upon consummation, this will be a landmark acquisition for IndiGrid and will provide an impetus in the renewable space, augment asset management capability and result in sizeable accretion,” IndiGrid’s CEO Harsh Shah said in a statement earlier this month.
IndiGrid, which itself counts KKR as a shareholder, will take over Mumbai-based VRET along with its investment manager and project manager, in one or more tranches. The all-cash transaction, whose value is in enterprise terms, hinges on shareholder and regulatory approvals.
Media speculation about VRET being up for sale emerged in early 2023. More than 10 major energy sector players were said to have lined up for the business. The list of purported suitors included Adani Green Energy Ltd, Torrent Power, private equity firm Actis, oil and gas giant Shell plc, Multiply Group PJSC and Jindal Steel and Power, according to local media reports.
(INR 100 = USD 1.209/EUR 1.118)
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