India’s mergers and acquisitions reach $2.5bn in first half of 2018
Within the first half of 2018, India’s total merger and acquisition (M&A) deals have already reached approximately Rs16,631 crore (US$2.5bn).
The largest renewable energy company in the country, ReNew Power, bought the New Delhi-based Ostro Energy for $1.5bn.
The acquisition, which was made in April, is the largest energy deal the country has ever seen, Quartz reported.
Greenko, the renewable energy power producer based in Hyderabad, has announced its plans to acquire Orange Renewables, which is currently owned by Singapore-based AT Capital.
Orange has 750MW of operation renewable energy, in both the wind and solar industries, spanning across five states: Andhra Pradesh, Karnataka, Madhya Pradesh, Rajasthan and Maharashtra.
The firm also has an additional 250MW of capacity that is currently under construction.
The enterprise value of the deal is anticipated to be worth $1bn according to Mahesh Kolli, the Founder and Joint Manager Director of Greenko, who informed Quartz.
In order to make the acquisition, the renewables firm has raised $447mn from investors, which include the Singapore sovereign wealth fund GIC and the Abu Dhabi Investment Forum.
“Only the strong hands will survive. This acquisition of Greenko-Orange is a step in that direction,” remarked Amit Kumar, Cleantech Partner at PwC, Quartz reported.
Following the deal, Greenko will meet ReNew in terms of total operating capacity, with the two firms managing around 4.3GW.
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.