Adani Green rises on announcing acquisition of renewable power portfolio of SB Energy

Adani Green Energy Limited (AGEL), a leading renewable energy company announced this morning that it has entered into a share purchase agreement with SB Energy Holdings Limited (SB Energy India) for complete acquisition of the latter.   

The soon-to-be acquired company- SB Energy India is a joint venture between Japan-based SoftBank Group Corp. and Bharti Group, which own a stake of 80 per cent and 20 per cent, respectively. It has a total renewable portfolio of 4,954 MW, which is spread across four states in India. The target portfolio comprises large scale utility assets with 84 per cent investment in solar capacity, 9 per cent in wind-solar hybrid capacity, and 7 per cent in wind capacity. The solar power project includes 1,400 MW of operational capacity while an additional capacity of 3,554 MW is still under construction.  

All the above-mentioned projects (i.e., assets in the portfolio) have power purchase agreements (PPA) with sovereign rated counterparties such as Solar Energy Corporation of India Ltd (SECI), NTPC Ltd and NHPC Ltd for the tenure of 25 years.  

The cost of this acquisition is approximately Rs 26,000 crore (USD 3.5 billion) and happens to be the largest acquisition in the renewable energy sector in the country. This acquisition enables AGEL to achieve its target renewable portfolio of 25 GW, four years ahead of the target timeline.   

At 12.41 pm on Wednesday, the share price of Adani Green Energy Limited was trading at Rs 1,225.75, which was a rise of 2.24 per cent over its previous day’s closing price of Rs 1,198.95 on BSE.