German power and energy major Siemens confirmed on Monday that its financial services arm has picked up 46 percent stake in Greenko Group’s 200 MW Poovani wind power project in Tamil Nadu for an undisclosed amount.
Its financial subsidiary Siemens Financial Services (SFS) has signed a definitive agreement with Greenko Group for the 46 percent equity investment, making this its first investment in a wind farm in Asia, the company said in a statement issued here.
For Greenko, the deal, coming after its own acquisition of Delhi-based Orange Renewables for almost a billion dollars, this will be a welcome move, to keep its financial leverage in control. Besides the potential in a long term engagement with Siemens. The Hyderabad based Greenko has an existing portfolio of 4.5 GW of Wind and Hydro assets, and a pipeline of projects worth close to 8GW. The Siemens deal, once closed, will add to its impressive roster of investors, that include the Abu Dhabi Investment trust, Singapore’s GIC, TPG growth, and EIG Global Energy Partners.
“Completing our first equity investment in renewables in the region further underscores our company’s commitment to bringing optimal energy solutions to India backed by innovative Siemens Gamesa Technology, Siemens Financial Services chief financial officer of Energy Finance Steffen Grosse said.
The company, however, did not disclose the amount it has invested for the equity stake. Typical valuations in the wind energy sector have been in the region of Rs 7-9 crores per MW of installed capacity.
The Poovani project is backed by Solar Energy Corporation of India (SECI) and involves installation of 100 units of Siemens Gamesa Renewable Energy’s SG 2.0 – 114 wind turbines in Tamil Nadu.
Clean and affordable energy generated from this project will offset around 651,000 tonne of CO2 from environment and electrify nearly 155,000 households annually.
Speaking on the development, Anil Kumar Chalamalasetty, chief executive officer and MD of Greenko Group, said that “attracting an equity investment from Siemens Financial Services demonstrates the evolution of the Indian energy market with inter-state transmission of renewable energy, confidence of international financial institutions on project and technical capabilities and the necessary regulatory frameworks to further support growth.”
The deal also signals a welcome return of big ticket equity investments in the renewables sector, where developers had increasingly started scouting for debt deals recently.