India: KCT Group looks to sell off renewable energy portfolio

KCT Group, the Vikram Thapar-led arm of the business house founded by Karam Chand Thapar, is exploring the sale of its renewable energy assets of 103 megawatts (MW), said two people aware of the development. Founded in 1929 as a coal mining company, the KCT Group currently has a diversified portfolio of businesses with interests in sectors ranging from coal, infrastructure, real estate, manufacturing and aquaculture. “There is a strong merger and acquisition (M&A) wave in the sector and hence they are keenly exploring a divestment of these renewable assets, which total to around 103 MW. Their portfolio currently includes wind projects in the state of Andhra Pradesh,” said one of the two people cited above, requesting anonymity as he is not authorized to speak to reporters. The asset sale could fetch the group between $100-150 million, he said. “Investment bank Kotak Mahindra Capital has been appointed to help find financial and strategic investors who would be interested in acquiring the assets,” the person added. Emails sent to Kotak Mahindra Capital did not elicit a response. “At present, we are exploring various strategic options with regard to our renewable energy business. As a diversified business group, we are excited to be part of the transformation in the energy landscape that India is undergoing, and believe that renewables will have an ever increasing role to play in the overall energy mix of the country. We will certainly get back to you once our plans are concretized,” said a KCT spokesperson in an emailed response to a query. Several renewable energy assets across wind and solar are on sale. On 19 July, Mint reported that French energy company Engie is in talks with Singapore-based renewable energy developer Equis Energy to acquire projects from its India portfolio comprising green energy platforms Energon and Energon Soleq. While Energon is focused on wind power projects with 414MW of operating assets, Energon Soleq is developing solar projects totaling 560MW. Last month, Mint reported that global private equity fund Actis Llp is exploring the sale of Ostro Energy Pvt. Ltd, a renewable energy company it owns. In February 2015, Actis committed $280 million to create renewable energy platform Ostro Energy in India to leverage the opportunities offered by the country’s emerging green economy. Earlier this year, renewable energy firm Inox Renewables Ltd agreed to sell its operating wind power farms to Chennai-based wind power company Leap Green Energy Pvt. Ltd. The assets, adding up to a total of 260MW, are located in Rajasthan, Maharashtra, Madhya Pradesh and Tamil Nadu. In January, renewable energy firm Orient Green Power Co. Ltd (OGPL) announced that it was evaluating a merger of its wind power business with IL&FS Wind Energy. The merger of the wind assets of the two firms will create a company with 1.2 gigawatts (GW) of operating assets. The M&A activity in 2017 follows the trend that started in 2016, when several large renewable portfolios got sold.

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