IPPs explore options to sell rooftop solar assets in India

Photo: Todae Solar

Rooftop and distributed solar energy project developers, including large independent power producers such as ReNew Power and Azure Power, are exploring the sale of their rooftop portfolios to raise capital, said three people aware of the development, requesting anonymity.

Others such as TPG-backed Fourth Partner Energy and SunSource Energy have already initiated talks with investors to raise equity capital to fund their growth plans, the people cited above said.

“Azure has mandated KPMG to find buyers for its rooftop portfolio of around 120 megawatts (MW), while ReNew has been looking at selling around 100MW. The idea is to sell operating assets and deploy the capital in their underdevelopment project pipeline,” said the first person cited above, declining to be named, as the talks are private.

On 24 July, The Economic Times reported that Fourth Partner Energy is planning to raise around $150 million and has mandated an investment bank to manage the fundraising process.

According to the second person cited above, SunSource Energy, another rooftop company, which is backed by SBI Capital’s Neev Fund, is also in the market to raise $50-100 million from private equity investors.

ReNew Power, Azure Power and KPMG declined to comment.

“We are a growth company in a growth sector and continue to evaluate solutions. We would not like to comment on anything specific to market speculation,” said a spokesperson for SunSource Energy.

According to industry experts, investors are seeing long-term growth potential in the distributed solar energy space, leading to mergers and acquisitions (M&A) and fundraising transactions.

“We are seeing increased activity across this segment in all transaction types—M&A, debt raising, and equity raising. The sector is expected to grow considerably over the coming years and the fundamental value proposition for customers is increasing,” said Rahul Goswami, managing director, Greenstone Advisors LLP, a boutique investment bank focused on the renewable sector.

“We expect transactions in this space to increase in scale. Several new investors are evaluating opportunities,” Goswami said.

Since 2017, the distributed renewable energy sector has seen investments worth $251 million across 10 deals, according to data from private investment tracker Venture Intelligence.

Investors who bet on this sector include Warburg Pincus, TPG Capital and UK Climate Investments.

Investors have poured billions of dollars into utility-scale solar projects, and are now closely looking at the distributed renewable space, with plans to invest in existing companies or to set up their own platforms.

 The article was first published on livemint.com

Singapore Reporter/s

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

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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.