Spanish firm Windar Renovables is exploring selling its 51% stake in its Russian joint venture to partner and steelmaker Severstal, three people familiar with the matter told Reuters.
Windar, which manufactures towers for wind turbines, would follow dozens of others of Western companies to secure an exit from Russia since Moscow despatched tens of thousands of troops to Ukraine in February 2022.
The deal would leave Severstal, whose main shareholder Alexey Mordashov is under U.S. and European Union sanctions, with full control of the venture, having bought out former JV partner Rusnano in 2021, upping its stake to 49%.
Windar and Severstal, which was sanctioned by the United States last June, declined to comment on the possible sale.
“Windar is in the process of exiting,” said one person, who asked not to be named, without disclosing the possible price.
Another source said Windar has been trying to exit Russia for a long time, with the sale of its stake to Severstal one of a handful of possibilities.
Exiting firms are being forced to sell their Russian operations at deep discounts, with several selling for a nominal fee and many incurring large write-downs. Companies often insert buyback clauses that could one day see them return.
Windar arrived in Russia, the world’s largest producer of fossil fuels, in 2018, when Moscow was showing a growing interest in renewable energy.
The Russian plant, located near the southern city of Rostov-on-Don, can make 150 towers a year and has contracts with Denmark’s Vestas and Siemens Gamesa, which holds a 32% stake in Windar.
Windar’s majority shareholder is the Daniel Alonso Group. Siemens Gamesa and its parent Siemens Energy both declined to comment.
Siemens Gamesa and Vestas halted their Russian operations after Moscow launched what it calls a “special military operation” in Ukraine. Two of the sources said the JV’s activities were also idle.
In response to that, a Severstal spokesperson said: “Half the market was paralysed after the exit of wind equipment producers, but Severstal expects the renewable energy market in Russia to stabilise this year and sees an opportunity for orders in this segment.”
Vestas completely exited Russia on Jan. 31, saying it put “a full stop to all remaining corporate activities without delay, including terminating remaining employees and leaving stranded assets including cash idle”.
The Windar Severstal JV is trying to compensate for possible damages due to loss of contract and this month got an injunction in court giving it permission to seize Vestas-owned towers.
Windar Severstal believes that Vestas’ market exit is sufficient to suggest that it does not intend to fulfil contractual obligations and is claiming around 1 billion roubles ($13.1 million) in debt and penalties from Vestas for backing out of the contract, court documents show.
Vestas did not immediately respond to request for comment.
Source: Reuters.com