CPPIB to invest $144 million in ReNew Power Ventures

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Mumbai: Canada Pension Plan Investment Board (CPPIB) on Monday said it is acquiring a 6.3% stake in ReNew Power Ventures Pvt. Ltd from Asian Development Bank for $144 million.

“This transaction aligns well with our overall power and renewables strategy, further diversifying the CPP Fund,” said Scott Lawrence, managing director and head of fundamental equities at CPPIB, Canada’s largest pension fund manager. “India’s overall power industry continues to grow and we see solar and wind as attractive clean energy sources to meet the country’s growing demand for electricity.”

CPPIB, Lawrence said, will continue to seek opportunities to expand its power and renewables portfolio, Lawrence said in a statement. “We look forward to a long-term partnership with ReNew Power’s excellent management team, which has a proven track record as a reliable, experienced developer and operator with an impressive portfolio built up over the past six years,” he added.

ReNew Power is a renewable energy developer and operator with clean energy capacity across wind and solar power producing assets. ReNew was founded by Sumant Sinha in 2011 and Goldman Sachs was its earliest backer. In February 2017, Japan’s JERA Co. Inc. bought a 10% stake in ReNew Power, valuing the company at $2 billion.

Since making its first investment in India in 2009, CPPIB’s investments in India stand at C$6.1 billion (Rs31,200 crore) as of September.

The Canadian pension fund has invested almost C$1.5 billion in India in the past one year. In January, it acquired a 48% stake in GlobalLogic Inc. from Apax, and in March a 3.3% stake in Bharti Infratel alongside PE firm KKR.

“We are committed to transforming our country’s energy portfolio, and CPPIB’s investment in the company will further strengthen our resolve. Asian Development Bank made an equity investment in ReNew Power during our early days in July 2014 and we are thankful to them for their sustained partnership. We will continue to focus on developing and investing in high-quality projects,” said Sinha, chairman and chief executive officer of ReNew Power.

CPPIB’s acquisition of stake in ReNew comes at a time when the company has been busy expanding its portfolio through inorganic growth.

In December, Mint reported that ReNew Power is close to acquiring Ostro Energy Pvt. Ltd, the company that holds the renewable energy assets of buyout firm Actis Capital, for an enterprise value of Rs10,000 crore.

Earlier in November, ReNew bought 103MW of renewable assets from Kolkata-based KCT Group for around Rs1,000 crore.

CPPIB invests in public equities, private equities, real estate, infrastructure and fixed income instruments. Based in Toronto, the firm has offices in Hong Kong, London, Luxembourg, Mumbai, New York City, São Paulo and Sydney.

As of 30 September, the CPP Fund totalled C$328.2 billion of assets under management.livemint