BlackRock-led consortium to invest Rs 4,000 cr in Tata Power's renewable unit
Apr 14, 2022
Mumbai (Maharashtra) [India], April 14 : Tata Power Company said on Thursday a consortium led by BlackRock Real Assets has agreed to invest Rs 4,000 crore (USD 525 million) to acquire 10.53 per cent stake in Tata Power Renewables.
The consortium includes Mubadala Investment Company. Tata Power and BlackRock Real Assets-led consortium have entered into a binding agreement to invest in Tata Power's renewable energy subsidiary, Tata Power Renewable Energy Limited.
BlackRock Real Assets, together with Mubadala, shall invest Rs 4,000 crore by way of equity / compulsorily convertible instruments for a 10.53 per cent stake in Tata Power Renewables, translating to a base equity valuation of Rs 34,000 crore. The final shareholding will range from 9.76 per cent to 11.43 per cent on final conversion.
This newly created platform will consist of five distinct businesses delivering long-term, customer-oriented solutions. It will house all renewable energy businesses of Tata Power including those in: Utility Scale Solar, Wind & Hybrid Generation assets; Solar Cell & Module Manufacturing; Engineering, Procurement and Construction (EPC) contracting; Rooftop Solar infrastructure; Solar Pumps and Electric Vehicle Charging infrastructure, Tata Power said in a statement.
The broad-based portfolio of assets ensures diversified yet stable revenue sources including 25-year fixed-price PPAs for grid connected utility scale projects.
Tata Power Renewables is one of the largest renewable energy companies in India. Its vertically integrated operations currently have approximately 4.9 GW of renewable energy assets.
The proposed investment is expected to fund Tata Power Renewables' aggressive growth plans. Over the next five years, Tata Power Renewables aims to achieve a portfolio of over 20 GW of renewables assets and a market leading position in the rooftop and electric vehicle charging space across India.
"Tata Power Renewables is an industry leader with a broad and deep portfolio of next-generation renewables businesses well placed to scale up rapidly based on its strong and consistent performance over the years. I am delighted to welcome BlackRock Real Assets & Mubadala to join us to take the renewables business to the next level of growth. The collaboration will support us to pursue exciting opportunities that lie ahead in the coming decades," Praveer Sinha, CEO and Managing Director, Tata Power Company Limited, said in a statement.
The first round of capital infusion is expected to be completed by June 2022 and the balance funds will be infused by end of the calendar year 2022.
Moelis & Company is the financial advisor to Tata Power, while JP Morgan is the financial advisor to BlackRock Real Assets. Cyril Amarchand Mangaldas & Co are legal advisors to Tata Power while Slaughter & May and AZB Partners are legal advisors to BlackRock Real Assets.
