April 17, 2018 / 8:42 AM / a year ago

British PE firm Actis close to buying solar assets of India's Shapoorji Pallonji - sources

MUMBAI/NEW DELHI (Reuters) - British private equity firm Actis is close to signing a deal to buy the solar power portfolio of Indian conglomerate Shapoorji Pallonji, three people aware of the development said on Tuesday.

A construction worker walks past a hoarding of Indian conglomerate Shapoorji Pallonji Group on the outskirts of Mumbai, India April 17, 2018. REUTERS/Francis Mascarenhas

The acquisition of Shapoorji’s 400 megawatt (MW) solar power portfolio will be done via a renewable platform owned by Actis named “Sprng Energy” at an equity valuation of around 11 billion rupees (£116.7 million), one of the people said, asking not to be named as final negotiations are ongoing.

“The due diligence is almost over and the equity value has been reached,” the person said, adding an announcement could come soon.

A Shapoorji spokesperson confirmed the company was “in advanced talks with key investors” regarding the solar assets. “As these discussions are confidential in nature, we would not like to comment on the same,” the spokesperson said.

Sanjiv Aggarwal, a partner at the firm, declined to comment directly on the deal but said Actis would “continue to grow through bids and M&A”. The firm’s long-term aim was to exit Sprng once it reaches capacity of 1,750 MW, he said.

Actis said in an emailed statement it has around $8.5 billion (£5.9 billion) in assets under management.

Gaurav Sood, Chief Executive Officer of Sprng, also declined to comment on the deal.

Shapoorji’s portfolio currently comprises of seven operational projects with a total capacity of 272 MW and an additional 130 MW under development.

A deal would come hard on the heels of Actis’ sale earlier this month of its first renewable energy platform, Ostro Energy, to Goldman Sachs-backed Renew Power Ventures (RENE.BO) at $1.5 billion.

India’s Prime Minister Narendra Modi aims to have 175 gigawatts (GW) of renewable capacity by 2022, up from 62 GW currently, out of which 100 GW is expected to come from solar.

Reporting by Promit Mukherjee in MUMBAI and Sudarshan Varadhan in NEW DELHI; Editing by Euan Rocha and Kenneth Maxwell

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