Making its entry into renewable energy space in India, Abu Dhabi government-owned energy company Masdar Clean Energy is all set to acquire about 20% stake in Hero Future Energies, the renewable energy arm of the Hero Group of the Munjal family, for $150 million, said two people aware of the development.
Post the transaction, Masdar will own 20% stake, IFC will own 27% stake while the rest will be held by promoters. International Finance Corp (IFC), the private sector investment arm of World Bank, invested $125 million in Hero Future in 2017.
Masdar is advised by BNP Paribas while JP Morgan advised Hero Future in the stake sale process. The deal will be signed by this week, said one of the persons cited above. Abu Dhabi’s Masdar Clean Energy has entered into exclusive talks to acquire a minority stake in Hero Future Energies, ET first reported in January this year.
Launched in 2012, Hero Future Energies is led by Rahul Munjal, the elder son of Hero MotoCorp founder late Raman Munjal.
Hero Future has 1,200 MW capacity of installed solar and wind power while another 500 MW is being built and 300 MW more is in pipeline. Hero Future Energies (HFE) has presence in 10 states of India with operating asset base across wind, solar PV (grid connected) and rooftop plants. In rooftop solar, the company has plans to implement 100 MW by 2018-19, while building a portfolio of 3.5 GW by 2022. A Hero Future Energies spokesperson declined to comment while a mail sent to Masdar did not elicit any response till the press time.
Wholly-owned by Mubadala Investment Company, the strategic investment company of the Government of Abu Dhabi, Masdar has made multiple acquisitions in new markets. The total value of renewable energy projects in which Masdar is a partner is more than $8.5 billion, with Masdar’s investment stake worth $2.7 billion. Under wind, solar PV and concentrated solar power (CSP), the total generating capacity of these projects exceeds 2,700 MW.
