Singapore-based Continuum in talks to raise funds via asset, stake sale

Photo: Pramugdha/Dealstreetasia

Continuum Wind Energy Ltd has started initial talks to raise funds through a stake sale or by selling some of its assets, three people aware of the company’s plan said.

Continuum held talks with potential financial investors including a Canadian pension fund and Dutch pension fund manager APG Asset Management for the stake sale, they said.

The growth plan of the firm, which has over 1 gigawatt (GW) of wind power projects across six states in the pipeline, took a hit last year when SunEdison Inc., the world’s largest renewable energy firm, backed out of a deal to buy it, citing a liquidity crunch and cost cuts after a series of big acquisitions.

The discussions are at an early stage and the company is exploring all options, including equity stake sale to financial investors or sale of operational assets to strategic investors, the three people cited above said.

Continuum is controlled by Morgan Stanley Infrastructure (MSI), an infrastructure-focused private equity fund.

SunEdison had said in June 2015 that it would acquire Continuum Wind for an undisclosed amount.

An Economic Times report at that time had estimated the deal to be in the range of Rs.3,700 crore-Rs.3,900 crore, making it one of the largest renewable energy deals in India.

Meanwhile, SunEdison, filed bankruptcy protection in the US on Thursday, has put all its India assets on the block.

“We are not in discussions with anyone and that is not the objective of the company right now,” said Arvind Bansal, founder, Continuum Wind, adding that the company would look to raise capital for growth but a time frame for it has not been decided.

Also Read: India: Wind energy firm NuPower looks to raise $300m in two tranches

He declined to comment on the amount of fund that the company is looking to raise.

Raja Parthasarathy, managing director, Morgan Stanley Infrastructure (MSI), did not respond to an email seeking comment.

As on June 2015, Continuum Wind owns and operates 242 megawatts (MW) of wind power plants in Maharashtra and Gujarat, besides a 170MW wind power unit under construction in Madhya Pradesh.

Bansal declined to comment on the company’s existing and planned capacities.

Companies building wind plants typically have to invest Rs.5 crore per MW, according to Anubhav Gupta, an analyst with Maybank Kim Eng Securities. This roughly translates to an investment of Rs.5,000 crore for 1GW of wind capacity, but could vary from project to project.

In recent weeks, Finnish state-run utility Fortum Corp., APG Asset Management along with India’s Piramal Enterprises Ltd and Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) have individually committed several million dollars worth of investment in India’s renewable energy market. Companies such as Continuum Wind are looking to benefit from this opportunity.

“As our investment with Piramal shows, we are interested in the Indian renewable energy sector. It is our policy, however, not to react to market rumours or talk about specific intended investments,” an APG Asset Management spokesman said in an email response.

India’s renewable energy sector has attracted strong interest from foreign funds after the government sharpened its focus on clean energy.

Prime Minister Narendra Modi is banking on renewable energy sources to fight climate change and has set an ambitious target of creating capacities to generate 175GW by 2022. The country currently has 22GW of wind energy capacity and over 5GW of solar capacity.

Recent months have seen other renewable energy companies either putting their assets on block or bringing in a financial investor for funding their pipeline of projects.

The renewable energy arm of the Hero Group, Hero Future Energies Ltd, is in talks with CDC Group Plc and International Finance Corp. (IFC) to raise $150 million (about Rs.1,000 crore), Mint reported on 4 April.

Tata Power Ltd and Hyderabad-based Greenko Group Plc have evinced interest in acquiring Welspun Renewables Energy Pvt. Ltd’s portfolio of 1.1GW of renewable power assets, Mint reported on 6 April.

Also Read:

India: SunEdison calls off deal to acquire Singapore-based Continuum Wind

India: BK Goenka-led Welspun Group to sell its renewable energy business

This 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.

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.

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.