French energy company Electricite de France SA (EDF) plans to partially divest its clean energy assets in India as part of efforts to pare its debt of more than $50 billion, said multiple people aware of the development.
EDF Renewables India has 530 MW of operational assets in Rajasthan and Gujarat. Presently, EDF has a clean energy pipeline of 1 GW in India.
EDF has hired Rothschild to run the sale process and feelers have been sent to global infrastructure investors such as KKR, Actis, CDPQ, Sembcorp as well as domestic players such as JSW, Torrent and Edelweiss Infrastructure-backed Sekura Energy, said the people cited above.
EDF did not respond to an email query till press time.
The Indian renewable energy space has seen multiple assets on the block in the past 6-8 months.
Canadian investor Brookfield put on sale its 2 GW portfolio in India, while British oil and gas giant Shell plans to offload a significant stake in 3 GW platform Sprng Energy. Italy’s Enel plans to sell 750 MW operational assets in India.
The people cited above said EDF is unlikely to sell its entire operational assets in India but will instead bring an investor by offloading about 50-70% assets and retain the remainder. A potential deal may value the total operational assets at ₹3,000-3,500 crore (about $400 million), the people said.
EDF Group’s net debt totalled ₹54.4 billion ($58.7 billion) as of 2023-end, reducing from the peak of ₹64.5 billion ($69.6 billion) in the previous year. It swung to a net profit of ₹10 billion in 2023, from a loss of 17.9 billion in 2022. Earnings before interest, tax, depreciation and amortisation stood at ₹39.9 billion, compared to a loss of ₹4.9 billion.
EDF is wholly owned by the French government. It is one of the largest power utility companies and the operator of the largest fleet of nuclear power plants in Europe.
Falling electricity prices are hindering EDF’s negotiations with industrial customers for long-term supply contracts, threatening the conglomerate’s financial health and ability to keep its aging nuclear plants running, Reuters reported in February. Corrosion problems, maintenance and technical issues had forced EDF to close several of France’s 56 nuclear reactors.
In India, EDF operates through five entities – EDF India, EDF International Networks, Citelum India, EDEN Renewables and EDF Renewables India. EDF Renewables, a subsidiary of the EDF Group, has a gross installed capacity of 15.6 GW across 20 countries with 5.9 GW under construction projects.
EDF has been looking to build the 9.9 GW Jaitapur nuclear power project at Ratnagiri in Maharashtra, in partnership with Nuclear Power Corp of India Ltd (NPCIL).
Service provider EDF International Networks has installed around 100,000 smart meters in India so far with the aim to eventually reach five million meters.
Source: Economic Times