PE firm Actis drops plan to buy Essel Infra’s solar assets in India

Photo: Pradeep Gaur/Mint

Private equity investor Actis LLP has scrapped its plan to buy the solar assets of debt-laden Essel Infraprojects Ltd, two people aware of the development said.

Subhash Chandra-promoted Essel Infra has now initiated talks with ACME Solar Holdings Ltd to sell the same solar energy assets, said the first of the two persons cited above, both of whom spoke on condition of anonymity.

The potential deal with Actis had an estimated value of ₹4,700 crore for 685 megawatts of Essel’s installed and under-construction projects.

ACME, however, is also hoping to acquire, as part of this deal, Essel Infra’s 25-year concession agreement with the Gujarat state water utility, Gujarat Water Infrastructure Ltd, to build and operate a ₹1,000 crore water desalination plant in the Jodiya district in the Gulf of Kutch, the first person said.

“Essel would prefer to close the sale of its assets by the end of the financial year so as not to miss a payment deadline,” the first person said. In 2016, Mint had reported that Essel Infra raised $132 million ( ₹900 crore at the time) from Piramal Enterprises and its Dutch partner, APG Asset Management. Certain non-convertible debentures (NCD) issued to the two lenders are due for their annual payments on 31 March, according to Essel Infra’s debenture prospectus filed with the Registrar of Companies. This was part of a ₹300 crore privately-placed NCD issue in March 2016.

Piramal Enterprises and APG are also lenders to ACME Solar.

A spokesperson for Piramal Capital and Housing Finance said, “The principal outstanding under the facility to Essel Green Infra is ₹220 crore. Essel Green Infra currently has a portfolio of approximately 700 MW of solar assets across multiple subsidiaries, the value of which acts as security for our outstanding exposure. There is interest payment of ₹15.5 crore that is due in the next 90 days. No principal repayment is due. The management of Essel Infra has been looking to monetise their solar portfolio and we understand that multiple parties have been evaluating the same.”

“ACME is one of our preferred partners in the renewable energy space and we have extended multiple facilities for project finance over the last 3 years, with a total exposure of ₹1,079 crore. Primary security for the same is a 2x cover on an identified operating portfolio of the group. ACME has recently pre-paid ₹52 crore ahead of schedule,” the spokesperson added. A spokesperson for Essel Infra said the company “is in advanced dialogues with all prospective partners for the sale of its solar business and the process is in steady progress and in line with the set timelines.”

“At this stage, due to the confidentiality agreements, with multiple prospective partners, the company cannot comment on any additional details. When the deal reaches at an advanced and appropriate stage, the company will officially communicate all the details,” the spokesperson said.

A spokesperson for Actis declined to comment. Nikhil Dhingra, CEO, ACME Solar, said in an email, “We aren’t in talks with Essel Infra or others to acquire its solar projects. We are focused on organic growth and are focused on improving yields from our existing 2.5 GWp (gigawatt peak) operational portfolio and executing around 700 MW till December.”

Also read:

UK private equity firm Actis seeks $500m for India real estate fund: report

Actis plans new firm to house all renewable energy assets in India

This article was first published on livemint.com.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

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Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.