Mukesh Ambani-controlled Reliance New Energy Solar, a wholly owned subsidiary of Reliance Industries (RIL), has acquired REC Solar Holdings (REC Group) from China National Bluestar (Group) Co. An RIL statement said the transaction is for an enterprise value of $771 million. This is the first major renewable energy deal, where an equipment manufacturing facility has been acquired.
Hours after picking up the Norwegian company, RIL also announced that its subsidiary will acquire a 40 per cent stake in Sterling & Wilson Solar Ltd through a combination of primary investment, secondary purchase and open offer for around Rs 2,850 crore.
Reliance New Energy Solar Ltd (RNESL) will first acquire 15 per cent in Sterling & Wilson by way of a preferential allotment of 29.3 million equity shares (equivalent to 15.46 per cent post preferential share capital) at Rs 375 per share. RIL will also acquire 18.4 million equity shares by RNESL from SP group company (equivalent to 9.7 per cent post preferential share capital) at a price of Rs 375 per share. This will cost RIL about Rs 1,100 crore.
The company will also acquire 25.9 per cent stake by way of an open offer at the same price. But as the current market price of S&W Solar is Rs 435 a share, the shareholders may not tender shares at the offer price. RNESL will hold 40 per cent of the equity capital of SWSL, consequent to acquisition in the open offer, follow-on acquisition of shares from SPCPL and chairman and co-founder of the company, Khurshed Daruvala, and sell down, if required. The promoters own 69.36 per cent stake in the company, which has a market valuation of Rs 6,972 crore.
Commenting on the acquisition, RIL chairman said, “It (the acquisition) is in line with our strategy of investing in new and advanced tech and operating capabilities aimed at achieving RIL’s goal of enabling 100 Gw of clean and green energy before the end of this decade.” “Together with our other recent investments, RIL is now ready to set up a global-scale integrated PV gigafactory and make India a manufacturing hub for lowest-cost and highest-efficiency solar panels,” he added.