Adani-Softbank's $3.5bn deal spurs green energy consolidation

BY Realty Plus
Published - May 28, 2021 11:43 AM

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Adani Green Energy, which plans to buy SoftBank Group's renewable energy assets in India, points to a new round of consolidation in the sector, which has drawn interest from private equity investors and top energy companies in recent years. In a May stock exchange filing, the renewable energy company led by billionaire Gautam Adani said it would buy SB Energy Holdings for an enterprise value of $3.5 billion. Adani is buying SoftBank Group Capital's 80% stake in SB Energy, and the remaining 20% held by Bharti Global in a cash deal. With the acquisition, Adani Green Energy will gain control of SB Energy Holding's nearly 5 GW of renewable energy assets, including 1.4 GW of operational projects. The rest are under construction. SB Energy Holding's green energy portfolio is 84% solar, 9% wind-solar hybrid and 7% wind projects. All come with 25-year power purchase agreements.

SoftBank said it is focused on stepping up its investments in artificial intelligence. While the Japanese company is virtually exiting the renewable energy business in India, Adani has indicated that it will accelerate its investments in this market.

"This acquisition is another step towards the vision we stated in January 2020, wherein we laid out our plans to become the world's largest solar player by 2025, and thereafter the world's largest renewable company by 2030," said Gautam Adani, chairman of Adani Group. "We are well on our way to achieve our stated solar portfolio targets four years before the deadline we set for ourselves."

The power assets bring Adani Energy closer to achieving its goal of owning 25 GW of renewable energy capacity by 2025. It currently has 19.3 GW of operating, under-construction, awarded and locked-in growth projects under its belt. Locked-in projects have a period during which they cannot be sold. Adani Energy is India's largest green energy company, and its moves are key to India's push to reach its goal of having 227 GW of renewable energy capacity by next year. The country currently has an installed capacity of 92.97 GW of renewable power, with an additional 50.15 GW in various stages of completion.

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Tags : Realty Spotlight Renewable Energy Acquisition India Softbank green energy Deal Investor Adani Green Energy