ONGC NTPC Green Pvt Ltd (ONGPL), an equal joint venture between ONGC Green and NTPC Green, is set to acquire a 100% stake in Ayana Renewable Power for $700-750 million, according to people with knowledge of the matter.
The JV has nearly completed the negotiations with Ayana’s current shareholders-National Investment and Infrastructure Fund (NIIF) (51%), British International Investment (BII) (32%) and EverSource Capital (17%)-on the terms of the sale, these people said. ONGPL will likely sign the share purchase agreement in a fortnight to purchase Ayana, they said.
The deal pegs the enterprise value of Ayana at $1.7-1.8 billion, people said. ONGC, NTPC, NIIF, BII and EverSource didn’t offer comment for the story.
ONGC Green is a wholly-owned subsidiary of state-run Oil and Natural Gas Corp and NTPC Green is a listed subsidiary of NTPC.
Ayana’s existing shareholders have infused ₹3,700 crore in the renewable energy platform against their capital commitment of $721 million (about ₹6,100 crore at the current exchange rate), ratings agency ICRA said in a September report. Ayana was launched by BII in 2017. NIIF and EverSource came in two years later. Ayana reported a consolidated profit of ₹46 crore on an operating income of ₹856 crore for 2023-24, per the report.
Ayana has a portfolio of 4.6 GW of operational and under-construction renewable energy assets encompassing solar, wind and storage. It currently operates 1.6 GW. It is expected to add 1 GW by March and another 1.5 GW by the end of the next fiscal year, according to people cited earlier.
ONGC, JSW Neo Energy and Sembcorp were shortlisted to submit binding bids for Ayana in August. Sembcorp sought a deviation in the bidding process and went out of the race while JSW and ONGC submitted bids. ONGC emerged as the top bidder and teamed up with NTPC.
ONGC, which has spent over two decades acquiring oil and gas assets worth billions globally, chose a state-run generator as a partner to mitigate the acquisition risks associated with a sector it is less familiar with. The Ayana deal would boost the green ambition of the oil and gas producer, which aims to have a renewable energy portfolio of 10 GW by 2030. In September, ONGC acquired PTC Energy Ltd for Rs 925 crore. PTC Energy has 288 MW wind generation capacity.
The deal would also expand the portfolio of NTPC Green whose shares are making waves on the bourses since they listed last week. Its shares are trading 37% above the issue price.
The Ayana deal would also offer an exit to private equity investors at a time when several renewable energy deals are struggling to close in the country.
Source: Economic Times