The four possible contenders could be joined by two or three more competitors that could include Canada-based pension funds
Renewable energy firms including Azure Power, Macquarie, KKR and ReNew Power are among players looking to bid for renewable energy company SprngEnergy, as per a report by the Economic Times.
SprngEnergy, owned by private equity firm Actis, will be sold to the bidder who bids for $1 billion or more, as per close sources. The company also has $1 billion of debt, meaning that the successful bidder will have to spend over $2 billion in the transaction.
“This is probably the largest cheque that one could have to write for a buyout of a renewable energy company in India so far,” an executive aware of the matter said.
While Azure Power and ReNew Power have held financing discussions with banks to raise money for a bid, Macquarie and KKRhave approached due diligence advisors ahead of a Christmas deadline for submission of non-binding offers for the company, these people said.
Final bids for Sprng Energy will need to be submitted by March. Bank of America Merrill Lynch is the financial advisor to Actis on the sale of the company.
The four possible contenders could be joined by two or three more competitors that could include Canada-based pension funds. Potential contenders have also been speaking to local banks for refinancing a portion of the company’s existing debt if they were to succeed in the bid.
The company has plans to develop a portfolio of 9 GW of renewable energy, which predominantly comprises solar power generation. It has an operational power generation capacity of around 2 GW.
Actis had invested $450 million to set up Sprng Energy in March 2017 with a plan to develop an India-focused renewable energy portfolio of assets. The UK-based private equity investor recently closed a $4.7 billion fund to invest in infrastructure.